SCS TRANSPORTATION INC (Form: 10-Q, Received: 11/04/2002 16:28:28)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


x		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
		EXCHANGE ACT OF 1934

FOR THE QUARTER ENDED SEPTEMBER 30, 2002


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
		EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM _______________ to _______________

Commission file number: 0-49983

SCS TRANSPORTATION, INC.

(Exact name of registrant as specified in its charter)


Delaware (State of incorporation)		48-1229851 (I.R.S. Employer Identification No.)


4435 Main Street, Suite 930 Kansas City, Missouri (Address of principal executive offices)		64111 (Zip Code)

(816) 960-3664
(Registrant’s telephone number, including area code)

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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes o No x
(Registrant has not been subject to filing requirements for past 90 days)

Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
Yes o No x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Common Stock	Outstanding Shares at October 31, 2002

Common Stock, par value $.001 per share		14,650,478

TABLE OF CONTENTS


PART I. FINANCIAL INFORMATION
	Item 1: Financial Statements
		CONDENSED CONSOLIDATED BALANCE SHEETS
		CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
	Item 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition
	Item 3. Quantitative and Qualitative Disclosures About Market Risk
	Item 4. Controls and Procedures
PART II. OTHER INFORMATION
	Item 1. Legal Proceedings — None
	Item 2. Changes in Securities and Use of Proceeds — None
	Item 3. Defaults Upon Senior Securities — None
	Item 4. Submission of Matters to a Vote of Security Holders — None
	Item 5. Other Information — None
	Item 6. Exhibits and Reports on Form 8-K
SIGNATURE
CERTIFICATION
EXHIBIT INDEX
EX-3.1 Amended/Restated Certificate of Incorp.
Ex-3.2 Amended/Restated By-laws
EX-4.1 Rights Agreement
EX-10.3 Master Separation & Distribution Agrmt.
EX-10.4 Tax Indemnification & Allocation Agrmt.
EX-99.1 Certification Pursuant to 18 U.S.C.
EX-99.2 Certification Pursuant to 18 U.S.C.

SCS TRANSPORTATION, INC.

INDEX

PAGE

PART I. FINANCIAL INFORMATION

ITEM 1: Financial Statements

     Condensed Consolidated Balance Sheets
     September 30, 2002 and December 31, 2001
3

     Condensed Consolidated Statements of Operations
     Quarter and Nine Months Ended September 30, 2002 and 2001
4

     Condensed Consolidated Statements of Cash Flows
     Nine Months Ended September 30, 2002 and 2001
5

     Notes to Condensed Consolidated Financial Statements 6-10

ITEM 2: Management’s Discussion and Analysis of Results of Operations and Financial Condition 10-15

ITEM 3: Quantitative and Qualitative Disclosures About Market Risk 16

ITEM 4: Controls and Procedures 16

PART II. OTHER INFORMATION

ITEM 1: Legal Proceedings 17

ITEM 2: Changes in Securities and Use of Proceeds 17

ITEM 3: Defaults Upon Senior Securities 17

ITEM 4: Submission of Matters to a Vote of Security Holders 17

ITEM 5: Other Information 17

ITEM 6: Exhibits and Reports on Form 8-K 17

Signature 20

Certifications 21-22

Exhibit Index E-1

PART I. FINANCIAL INFORMATION

Item 1: Financial Statements

SCS TRANSPORTATION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)

September 30, December 31,

2002 2001

ASSETS

Current Assets:

Cash
$ 2,383 $ 1,480

Accounts receivable
99,233 83,387

Prepaid expenses and other
35,558 28,589

Total current assets
137,174 113,456

Property and Equipment:

Cost
491,200 477,108

Less: accumulated depreciation
194,515 171,067

Net property and equipment
296,685 306,041

Goodwill and Other Assets
19,449 92,449

Total assets
$ 453,308 $ 511,946

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current Liabilities:

Accounts payable and checks outstanding
$ 23,584 $ 30,815

Wages and employees’ benefits
31,448 26,816

Other current liabilities
31,067 28,036

Current maturities of long-term debt
— 6,489

Total current liabilities
86,099 92,156

Other Liabilities:

Long-term debt, less current portion
127,100 32,346

Notes to former Parent
— 90,157

Deferred income taxes
54,590 58,949

Claims, insurance and other
14,751 8,689

Total other liabilities
196,441 190,141

Shareholders’ Equity:

Preferred stock, $.001 par value, 50,000 authorized, none issued and outstanding
— —

Common stock, $.001 par value; 50,000,000 shares authorized, 14,565,478 shares issued and outstanding
15 —

Additional paid-in capital
200,133 —

Retained earnings (deficit)
(29,380 ) —

Parent company equity
— 229,649

Total shareholders’ equity
170,768 229,649

Total liabilities and shareholders’ equity
$ 453,308 $ 511,946

The accompanying notes are an integral part of these statements.

SCS TRANSPORTATION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)

Third Quarter Nine Months

2002 2001 2002 2001

Operating Revenue
$ 201,155 $ 195,152 $ 581,181 $ 586,764

Operating Expenses:

Salaries, wages and employees’ benefits
112,604 110,325 330,516 331,560

Purchased transportation
20,854 19,206 58,861 52,971

Operating expenses and supplies
34,792 34,971 97,382 109,960

Operating taxes and licenses
7,778 7,714 23,265 23,700

Claims and insurance
5,439 5,421 17,201 15,169

Depreciation and amortization
11,359 12,194 33,717 36,774

Operating (gains) and losses
233 (240 ) 495 (454 )

Integration charges
— — — 6,705

Total operating expenses
193,059 189,591 561,437 576,385

Income from Operations
8,096 5,561 19,744 10,379

Nonoperating Expenses:

Interest expense
1,201 2,413 3,913 9,082

Other, net
77 91 153 83

Nonoperating expenses, net
1,278 2,504 4,066 9,165

Income Before Income Taxes and Cumulative Effect of Accounting Change
6,818 3,057 15,678 1,214

Income Tax Provision
2,813 1,634 6,652 2,246

Income (Loss) Before Cumulative Effect of Accounting Change
4,005 1,423 9,026 (1,032 )

Cumulative Effect of Change in Accounting for Goodwill
— — (75,175 ) —

Net Income (Loss)
$ 4,005 $ 1,423 $ (66,149 ) $ (1,032 )

Average common shares outstanding — basic and diluted
14,565 14,565 14,565 14,565

Basic and Diluted Earnings (Loss) Per Share:

Before cumulative effect of accounting change
$ 0.27 $ 0.10 $ 0.62 $ (0.07 )

Cumulative effect of change in accounting for goodwill
— — (5.16 ) —

Net Income (Loss)
$ 0.27 $ 0.10 $ (4.54 ) $ (0.07 )

The accompanying notes are an integral part of these statements.

SCS TRANSPORTATION, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
(IN THOUSANDS)
(UNAUDITED)

2002 2001

Operating Activities:

Net cash provided by operating activities
$ 17,232 $ 39,820

Investing Activities:

Acquisition of property and equipment
(29,359 ) (17,748 )

Proceeds from disposal of property and equipment
4,987 3,688

Net cash used in investing activities
(24,372 ) (14,060 )

Financing Activities:

Proceeds from issuance of long-term debt
110,789 —

Repayment of long-term debt
(22,525 ) (1,298 )

Equity contribution from former Parent
— 815

Net change in Notes to former Parent
(80,221 ) (26,835 )

Net cash provided by (used in) financing activities
8,043 (27,318 )

Net increase (decrease) in cash
903 (1,558 )

Cash at beginning of period
1,480 4,922

Cash at end of period
$ 2,383 $ 3,364

Supplemental Cash Flow Information:

Income taxes paid, net
$ 14,713 $ 485

Interest paid
$ 4,404 $ 9,081

Non cash transactions:

Equity contribution from former Parent
$ 6,936 $ —

Decrease in intercompany debt
$ (6,936 ) $ —

The accompanying notes are an integral part of these statements.

SCS TRANSPORTATION, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

(1) Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of SCS Transportation, Inc. and its two wholly owned regional transportation subsidiaries (the Company or SCST), Saia Motor Freight Line, Inc. and Jevic Transportation, Inc.

The condensed consolidated financial statements have been prepared by the Company, without audit by independent public accountants. In the opinion of management, all normal recurring adjustments necessary for a fair statement of the financial position, results of operations and cash flows for the interim periods included herein have been made. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted from these statements. These interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information, the instructions to Quarterly Report on Form 10-Q and Rule 10-01 of Regulation S-X. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s 2001 audited consolidated financial statements included as an Exhibit to the Company’s registration statement on Form 10 that became effective September 9, 2002 (the Information Statement). Operating results for the quarter and nine month period ended September 30, 2002, are not necessarily indicative of the results of operations that may be expected for the year ended December 31, 2002.

The Spin-off

On July 19, 2002, the Yellow Corporation (Yellow) Board of Directors approved the spin-off of its 100 percent interest in SCST to Yellow shareholders (the Spin-off). On August 6, 2002, Yellow received a tax ruling from the Internal Revenue Service (IRS) which states that for United States federal income tax purposes the Spin-off qualifies as a tax-free distribution under Section 355 of the Internal Revenue Code. SCST common stock is listed on the NASDAQ under the symbol “SCST”. On September 30, 2002 the Spin-off was consummated and SCST paid approximately $110.6 million of $113.6 million due in satisfaction of intercompany indebtedness to Yellow. The remaining $3.0 million liability is reflected as other current liabilities and was paid subsequent to September 30, 2002. These payments, in addition to the $16.4 million in subordinated notes assumed by the Company, comprised the $130 million dividend due Yellow under the Master Separation and Distribution Agreement. The remaining $6.9 million reduction in the intercompany indebtedness to Yellow was a capital contribution from Yellow to SCST. The Master Separation and Distribution and Tax Indemnification and Allocation Agreements between Yellow and SCST are both described further in the Information Statement on Form 10 and these agreements have been filed as Exhibits 10.3 and 10.4 herein. SCST shares were distributed to Yellow shareholders on the basis of one SCST share for every two Yellow shares held on the record date of September 3, 2002. The total number of SCST shares distributed was 14,565,478. At the Spin-off, SCST’s assets and liabilities have been reflected at historical cost.

Organization

The Company provides regional overnight and second-day less-than-truckload (LTL) and selected truckload (TL) transportation services through two subsidiaries, Saia Motor Freight Line, Inc. (Saia) and Jevic Transportation, Inc. (Jevic). For the quarter ended September 30, 2002 Saia comprised approximately 63 percent and Jevic approximately 37 percent of total revenue.

Certain of SCST’s long-term debt is guaranteed by its subsidiaries. The guarantees are full and unconditional, joint and several, and any subsidiaries that are not guarantors are minor as defined by Securities and Exchange

Commission (SEC) regulations. SCST, as the parent company issuer of this debt, has no independent assets or operations. There are no significant restrictions on the Company’s ability or the ability of any guarantor to obtain funds from its subsidiaries by such means as a dividend or loan.

New Accounting Pronouncements

Effective January 1, 2002, SCST adopted Statement of Financial Accounting Standards (SFAS) No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets.” SFAS No. 144 supersedes SFAS No. 121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of,” and provides a single accounting model for the disposal of long-lived assets from continuing and discontinued operations. The adoption of this statement had no material impact on our financial position or results of operations.

In June 2002, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 146, “Accounting for Costs Associated with Exit or Disposal Activities.” The statement changes the measurement and timing of recognition for exit costs, including restructuring charges, and is effective for any such activities initiated after December 31, 2002. It has no effect on charges recorded for exit activities begun prior to this date. The adoption of this statement is not anticipated to have a material effect on our financial position or results of operations.

(2) Goodwill and Other Intangible Assets

On June 30, 2001, the FASB issued SFAS No. 142, “Goodwill and Other Intangible Assets”, which was adopted by the Company on January 1, 2002. SFAS No. 142 requires that upon adoption and at least annually thereafter, the Company assess goodwill impairment by applying a fair value based test. With the adoption of Statement No. 142, goodwill will no longer be subject to amortization, resulting in an increase in annualized operating income and net income of $3.0 million.

At December 31, 2001 the Company had $90 million of goodwill on its consolidated balance sheet, consisting primarily of $75.2 million remaining from the acquisition of Jevic. In valuing the goodwill of Jevic, the Company used an estimate of Jevic’s discounted cash flows in measuring whether goodwill was recoverable. Based on this estimate, the Company determined that 100 percent of the Jevic goodwill was impaired due to lower business volumes, compounded by a weak economy, and an increasingly competitive business environment. As a result, the Company recorded a non-cash charge of $75.2 million in the first quarter 2002, which was reflected as a cumulative effect of a change in accounting principle.

The carrying amount of goodwill attributed to each reportable operating segment with goodwill balances and adjustments follows (in thousands):


	December 31,		Impairment			September 30,
	2001		Adjustment			2002

Saia	$	14,796	$	—		$	14,796
Jevic		75,175		(75,175	)		—

	$	89,971	$	(75,175	)	$	14,796

Actual results of operations before cumulative effect of accounting change for the third quarter and nine months of 2002 and pro forma results of operations for the third quarter and nine months of 2001 had the Company applied the nonamortization provisions of SFAS No. 142 in those periods follow (in thousands, except per share amounts):

Quarter Ended September 30, Nine Months Ended September 30,

2002 2001 2002 2001

Reported income (loss) before cumulative effect of accounting change
$ 4,005 $ 1,423 $ 9,026 $ (1,032 )

Add: Goodwill amortization
— 746 — 2,248

Adjusted income before cumulative effect of accounting change
$ 4,005 $ 2,169 $ 9,026 $ 1,216

Basic and diluted earnings per share:

Reported income (loss) before cumulative effect of accounting change
$ 0.27 $ 0.10 $ 0.62 $ (0.07 )

Goodwill amortization
— 0.05 — 0.15

Adjusted income before cumulative effect of accounting change
$ 0.27 $ 0.15 $ 0.62 $ 0.08

(3) Financing Arrangements

On September 20, 2002 SCST issued $100 million in Senior Notes under a $125 million Master Shelf Agreement with Prudential Investment Management, Inc. and certain of its affiliates and entered into a $50 million Agented Revolving Credit Agreement (the Credit Agreement) with Bank of Oklahoma, N.A., as agent. Proceeds from the Senior Notes and a portion of the Credit Agreement were used for payments due Yellow in connection with the completion of the Spin-off on September 30,2002.

The $100 million Senior Notes are unsecured, have a fixed interest rate of 7.38% and have an average maturity of eight years. Payments due under the Senior Notes are interest only until June 30, 2006 and at that time semi-annual principal payments begin with the final payment due December 2013. Under the terms of the Senior Notes, SCST must maintain certain financial covenants including a ratio of total indebtedness to earnings before interest, taxes, depreciation, amortization and rent (EBITDAR), an interest coverage ratio and a tangible net worth, among others. At September 30, 2002, the Company was in compliance with these covenants.

The $50 million Credit Agreement is unsecured with an interest rate based on LIBOR or prime at the Company’s option, plus an applicable spread, in certain instances, and matures in September 2005. The availability under the Credit Agreement is limited to SCST’s qualified receivables (as defined in the Credit Agreement). At September 30, 2002, SCST had borrowings under the Credit Agreement of $10.7 million and availability of $39.3 million. Under the terms of the Credit Agreement, SCST must maintain certain financial covenants including a ratio of total indebtedness to EBITDAR, an interest coverage ratio and a tangible net worth, among others. At September 30, 2002, the Company was in compliance with these covenants.

(4) Stock Options

The Company has reserved and made stock option grants for 1.3 million shares of its common stock to certain management personnel of the Company and its operating subsidiaries under the “2002 Substitute Stock Option Plan”. As a result of the spin-off of SCST from Yellow, on October 1, 2002, all Yellow stock options (Old Yellow Options) issued and outstanding to employees of SCST were replaced with SCST Stock Options (New SCST Options) with a value identical to the value of the Old Yellow Options being replaced. The number of New SCST Options and their exercise price was determined based on the relationship of the SCST stock price immediately after the Spin-off and the Yellow stock price immediately prior to the Spin-off.

The New SCST Options expire ten years from the initial date the Old Yellow Options were originally issued by Yellow. The New SCST Options continue to vest ratably over the original four-year vesting period of the Old Yellow Options. The Company applies Accounting Principles Board Opinion No. 25, Accounting for Stock Issued

to Employees, in accounting for its plan. On October 1, 2002, options on 1,280,742 shares were outstanding at a weighted average exercise price of $4.81 and options on 620,812 shares were exercisable at a weighted average exercise price of $5.26. The weighted average remaining contractual life on the New SCST Options at October 1, 2002 was 6.9 years.

(5) Computation of Earnings Per Share

The calculation of basic and diluted earnings per share for the periods ended September 30, 2002 and all prior periods was based upon the shares outstanding as of the date of the Spin-off from Yellow, which was September 30, 2002. Effective October 1, 2002, diluted earnings per share will include the dilutive impact of outstanding stock options.

(6) Business Segment Information

The Company reports financial and descriptive information about its reportable operating segments on a basis consistent with that used internally for evaluating segment operating performance and allocating resources to segments.

The Company has two reportable segments, which are strategic business units that offer different products and services. Saia is a regional LTL carrier that provides primarily overnight and second-day service in twenty-one states and Puerto Rico. Jevic is a hybrid heavy LTL and TL carrier that provides primarily overnight and second-day regional service and interregional service throughout the United States.

The segments are managed separately because each requires different operating, technology and marketing strategies. The Company evaluates performance primarily on operating income and return on capital.

The accounting policies of the segments are the same as those described in the summary of significant accounting policies in the Company’s 2001 consolidated financial statements included in the Information Statement filed on Form 10. Management fees and other corporate services are charged to segments based on direct benefit received or allocated based on revenue. The following table summarizes the Company’s operations by business segment (in thousands):

Corporate

and

Saia Jevic Other Consolidated

As of September 30, 2002

Identifiable assets
$ 295,982 $ 157,676 $ (350 ) $ 453,308

As of December 31, 2001

Identifiable assets
$ 280,427 $ 231,519 $ — $ 511,946

Quarter ended September 30, 2002

Operating revenue
$ 127,580 $ 73,575 $ — $ 201,155

Income (loss) from operations
6,526 1,851 (281 ) 8,096

Quarter ended September 30, 2001

Operating revenue
$ 125,072 $ 70,080 $ — $ 195,152

Income (loss) from operations
5,077 1,060 (576 ) 5,561

Nine months ended September 30, 2002

Operating revenue
$ 366,636 $ 214,545 $ — $ 581,181

Income (loss) from operations
16,176 3,650 (82 ) 19,744

Nine months ended September 30, 2001

Operating revenue
$ 367,179 $ 219,585 $ — $ 586,764

Income (loss) from operations
6,577 4,919 (1,117 ) 10,379

(7) Commitments and Contingencies

The Company is subject to legal proceedings that arise in the ordinary course of its business. In the opinion of management, the aggregate liability, if any, with respect to these other actions will not materially adversely affect our financial position, results of operations or cash flows.

Item 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition

GENERAL

The following management’s discussion and analysis describes the principal factors affecting the results of operations, liquidity and capital resources, as well as the critical accounting policies, of SCS Transportation, Inc. (also referred to as SCST). This discussion should be read in conjunction with the accompanying condensed consolidated financial statements and our 2001 audited consolidated financial statements included as an Exhibit to the Company’s registration statement on Form 10 that became effective September 9, 2002 (the Information Statement). These financial statements include additional information about our significant accounting policies, practices and the transactions that underlie our financial results.

SCST is a leading transportation company providing regional and interregional less-than-truckload (LTL) and selected truckload (TL) service solutions to more than 64,000 customers across the United States. Our operating subsidiaries are Saia Motor Freight Line, Inc. (Saia), based in Duluth, Georgia and Jevic Transportation, Inc. (Jevic), based in Delanco, New Jersey. On September 30, 2002, Yellow Corporation completed a tax-free distribution to its shareholders of 100 percent of the outstanding common stock of SCST.

The key factors that affect our operating results are the volumes of shipments transported through our networks, as measured by our average daily shipments and tonnage; the prices we obtain for our services, as measured by revenue per hundred weight (yield) and revenue per shipment; our ability to manage our cost structure for capital expenditures and operating expenses such as salaries, wages and benefits, purchased transportation, insurance claims and expense, fuel and maintenance; and our ability to match operating costs to shifting volume levels.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

SCST makes estimates and assumptions in preparing the consolidated financial statements that affect reported amounts and disclosures therein. In the opinion of management, the accounting policies that generally have the most significant impact on the financial position and results of operations of SCST include:

       •    Claims and Insurance Accruals. SCST has self-insured retention limits generally ranging from $250,000 to $1,000,000 for medical, workers’ compensation, auto liability, casualty and cargo claims. The liabilities associated with the risk retained by SCST are estimated in part based on historical experience, third-party actuarial analysis, demographics, severity and other assumptions. However, these estimated accruals could be significantly affected if the actual costs of SCST differ from these assumptions and historical trends.

       •    Depreciation and Capitalization of Assets. Under the SCST accounting policy for plant and equipment, management establishes appropriate depreciable lives and salvage values for SCST’s revenue equipment (tractors and trailers) based on their estimated useful lives and estimated fair values to be received when the equipment is sold or traded in. These estimates are continuously evaluated and updated when circumstances warrant. However, actual depreciation and salvage values could differ from these assumptions based on market conditions and other factors.

       •    Recovery of Goodwill. On January 1, 2002, SCST adopted Financial Accounting Standards Board Statement No. 142 — Goodwill and Other Intangible Assets. The statement requires that, on adoption and at least annually thereafter, SCST assess goodwill impairment by applying a fair value based test. This fair value based test involves assumptions regarding the long-term future performance of the operating subsidiaries of SCST, fair value of the assets and liabilities of SCST, cost of capital rates and other assumptions. However, actual recovery of goodwill could differ from these assumptions based on market conditions and other factors.

• Revenue Recognition and Related Allowances. SCST’s accounting policy for revenue recognition is based on relative times for shipments in transit at the balance sheet date with expenses being recognized as incurred. In addition, estimates included in the recognition of revenue and accounts receivables include estimates of unbilled revenue, estimates of shipments in transit and estimates of future adjustments to revenue and accounts receivable for billing adjustments and collectibility.

Estimates of unbilled revenue arise from a time lag of generally up to 3 days between the pick-up of the shipment and the generation of the invoice. This revenue is recognized in a systematic process and the estimate is for invoices that are essentially complete, with little subjectivity of the amounts accrued. Estimates of shipments in transit are based upon actual shipments picked up, scheduled day of delivery and current trend in average rates charged to customers. Since the cycle of the majority of shipments is generally 1-3 days, typically less than 5 percent of a total month’s revenue is in transit at the end of any month. Estimates for credit losses and billing adjustments are based upon historical experience of credit losses, adjustments processed and trends of collections. Billing adjustments are primarily made for discounts and billing corrections. These estimates are continuously evaluated and updated, however changes in economic conditions, pricing arrangements, etc. can significantly impact these estimates.

These accounting policies, and others, are described in further detail in the notes to our 2001 audited consolidated financial statements.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to adopt accounting policies and make significant judgments and estimates to develop amounts reflected and disclosed in the financial statements. In many cases, there are alternative policies or estimation techniques that could be used. We maintain a thorough process to review the application of our accounting policies and to evaluate the appropriateness of the many estimates that are required to prepare the financial statements. However, even under optimal circumstances, estimates routinely require adjustment based on changing circumstances and the receipt of new or better information.

RESULTS OF OPERATIONS

Quarter and nine months ended September 30, 2002 vs. quarter and nine months ended September 30, 2001

Revenue and volume

Operating revenue of SCST for the quarter ended September 30, 2002 was $201 million, up 1.5 percent on a per day basis from $195 million for the quarter ended September 30, 2001. The third quarter of 2002 had one more workday than the third quarter of 2001. After several quarters of continuing economic weakness, Saia and Jevic experienced quarter-over-quarter shipment increases and while Saia had quarter over quarter tonnage increases, Jevic’s tonnage was relatively flat between quarters. The quarter-over-quarter decline in fuel prices resulted in a $1.0 million decrease in fuel surcharge revenue in 2002 versus 2001, which contributed to part of the deterioration in yields. For the nine months ended September 30, 2002 revenues were $581 million versus $587 million for the nine months ended September 30, 2001, primarily due to the sluggish economy.

The financial and operational statistics of Saia have been presented to reflect the merger of WestEx and Action Express into Saia, which was effective March 4, 2001 as further described in the SCST audited financial statements. Saia had operating revenue of $128 million for the quarter ended September 30, 2002, up 0.4 percent on a per day basis from $125 million for the quarter ended September 30, 2001. Quarter-over-quarter Saia LTL revenue per hundredweight (a measure of yield) decreased 2.6 percent to $9.77 per hundredweight for the quarter ended September 30, 2002, while adjusted for equivalent workdays, LTL tonnage was up 3.3 percent to 602,000 tons and LTL shipments were up 3.4 percent to 1.1 million shipments. The decrease in yield is a combination of freight mix, competitive pricing pressure and decrease in fuel surcharge revenue. For the nine months ended September 30, 2002, Saia had operating revenue of $367 million, consistent with the nine months ended September 30, 2001. Saia implemented a 5.9% general rate increase effective July 15, 2002, on all noncontractual accounts.

Jevic had operating revenue of $74 million for the quarter ended September 30, 2002, up 3.3 percent on a per day basis from operating revenue of $70 million for the quarter ended September 30, 2001. Jevic yield increased 2.3 percent to $6.34 per hundredweight, while quarter-over-quarter tonnage was down 0.3 percent on a per day basis

to 567,000 tons and shipments were up 2.0 percent to 244,000 shipments. Jevic experienced improved volume trends in the third quarter of 2002 after several quarters of declining trends due to the economic downturn and competition. The increase in yield is due to a firming in the pricing environment and implementation of an August general rate increase on LTL of approximately 5.9%. For the nine months ended September 30, 2002 Jevic had operating revenue of $215 million, a decrease of 2.3 percent on a per day basis from $220 million for the nine months ended September 30, 2001.

Operating income

Operating income for SCST for the quarter ended September 30, 2002 was $8.1 million versus $5.6 million for the quarter ended September 30, 2001. The increase in operating income is primarily due to a combination of cost management efforts and a modest increase in shipping volumes. The third quarter 2002 operating ratio (operating expenses divided by net revenue) for SCST was 96.0 compared to the third quarter 2001 operating ratio of 97.2.

Operating income for the nine months ended September 30, 2002 was $19.7 million versus $10.4 million for the nine months ended September 30, 2001. The operating income in 2001 included $6.7 million of one-time costs for the integration of WestEx and Action Express into Saia. SCST operating ratio for the nine months ended September 30, 2002 was 96.6 compared to the operating ratio for the nine months ended September 30, 2001 of 98.2. Both Saia and Jevic focused on cost management and took action to control variable costs through the periods of economic downturn. However, these costs reductions were partially offset by increases in workers’ compensation and other insurance costs and other operating expenses.

Saia third quarter 2002 operating income was $6.5 million compared to operating income of $5.1 million for the third quarter of 2001. Despite the decrease in yield discussed above, Saia improved its operating income due to strong cost controls and improved operating efficiencies. Additionally, Saia implemented a wage increase in August 2002 resulting in a 2.9 percent increase in salaries and wages for the third quarter of 2002 over the third quarter of 2001, which was substantially offset by labor productivity gains and other expense reductions. As of the end of third quarter of 2002, Saia's wage rates are 4 percent higher than the end of third quarter of 2001. Saia increased its use of purchased transportation to fill peak capacity needs during the third quarter of 2002 versus the prior period.

Saia operating ratio was 94.9 for the third quarter 2002 compared to 95.9 in the third quarter of 2001. Saia quarter-over-quarter yield deteriorated from competitive pricing pressure but was offset by tonnage increases, productivity gains and variable cost control. For the nine months ended September 30, 2002 Saia had operating income of $16.2 million compared to operating income of $6.6 million for the nine months ended September 30, 2001. Saia operating ratio was 95.6 for the first nine months of 2002 compared to an operating ratio of 98.2 for the first nine months of 2001. Integration charges in 2001 were $6.7 million related to the integration of WestEx and Action Express into Saia.

Jevic third quarter 2002 operating income was $1.9 million compared to $1.1 million for the third quarter in 2001. Jevic operating ratio was 97.5 for the third quarter of 2002 compared to 98.5 for the third quarter of 2001. Jevic’s increased profitability resulted from quarter-over-quarter yield improvement and the elimination of goodwill amortization of approximately $0.5 million in the third quarter of 2001. Jevic results for the quarter ended September 30, 2002 also include $0.9 million higher than anticipated workers’ compensation expense relating to Jevic’s implementation of a more conservative, actuarial estimate for establishing workers’ compensation reserves. This increase in profitability was obtained despite a 3.4 percent average wage increase over wages in the third quarter of 2001. The wage increase was offset by a reduction in purchased transportation as Jevic more efficiently utilized purchased transportation in meeting its peak capacity needs. For the nine months ended September 30, 2002 Jevic had operating income of $3.7 million and an operating ratio of 98.3 compared to operating income of $4.9 million and an operating ratio of 97.8 for the nine months ended September 30, 2001.

SCST had nonoperating expenses of $1.3 million in the third quarter of 2002 compared to nonoperating expenses of $2.5 million in the third quarter of 2001. Substantially all SCST nonoperating expenses represent interest expense. The decrease in interest cost is a result of a combination of lower debt and lower interest rates in 2002 versus 2001. The effective tax rate for the third quarter of 2002 was 41 percent compared to an effective tax rate of 53 percent in the third quarter of 2001. Net income was $4.0 million in the third quarter of 2002 compared to net income of $1.4 million in the third quarter of 2001. For the nine months ended September 30, 2002 SCST had nonoperating expenses of $4.1 million compared to $9.2 million in the prior year again reflecting lower interest costs. The results of operations in 2002 reflect a non-cash charge of $75.2 million for the impairment of goodwill associated with Jevic. Income before cumulative effect of the goodwill impairment was $9.0 million for the nine months ended September 30, 2002 compared to a net loss of $1.0 million for the nine months ended September 30, 2001. Including the goodwill impairment, the net loss for the first nine months of 2002 was $66.1 million.

Working capital/capital expenditures

SCST’s working capital increased from $21.3 million at December 31, 2001 to $51.1 million at September 30, 2002. The change in working capital is predominantly a result of seasonal increases in accounts receivable and a decrease in current maturities of long-term debt and accounts payable and checks outstanding. Net capital expenditures were $24.4 million for the nine months ended September 30, 2002 compared to $14.1 million for the nine months ended September 30, 2001. The first nine months of 2002 capital investments primarily represent capital replacement of revenue equipment and the purchase of two new terminals for Saia, net of proceeds from the sale of an existing Saia terminal.

Outlook

Our outlook assumes no significant economic recovery or deterioration in the fourth quarter of 2002. We anticipate our portfolio of transportation trucking solutions will continue to generate long-term growth.

In the short-term, we will continue to focus on cost management efforts, while further improving productivity and positioning the Company for longer-term growth. Actual results for 2002 will depend upon a number of factors, including the timing, speed and magnitude of the economic recovery or downturn, our ability to match capacity with shifting volume levels, competitive pricing pressures and insurance claims. In addition, adjustments to our fuel surcharge levels lag changes in actual diesel fuel prices paid. Therefore, our operating income can be affected should the price of diesel fuel suddenly change by a significant amount.

See “Forward-Looking Statements” for a more complete discussion of potential risks and uncertainties that could materially affect our future performance.

New Accounting Pronouncements

See Note 1 to the accompanying financial statements for further discussion of recent accounting pronouncements.

FINANCIAL CONDITION

SCST liquidity needs arise primarily from capital investment in new equipment, land and structures and information technology, as well as funding working capital requirements.

To ensure long-term liquidity, SCST has historically maintained working capital line-of-credit agreements with Yellow totaling $225 million at December 31, 2001. These line-of-credit agreements had interest at 50 basis points over LIBOR rate, adjusted quarterly. These line of credit arrangements with Yellow were refinanced with third party debt facilities in connection with the Spin-off. In addition, SCST had third party borrowings of approximately $16.4 million in a subordinated debt facility. SCST had approximately $120.5 million outstanding under the line-of-credit agreements with Yellow immediately prior to the Spin-off, of which $110.6 million was repaid to Yellow under the terms of the Spin-off. Additionally, $3.0 million of the line-of-credit with Yellow is reflected as other current liabilities and was paid subsequent to September 30, 2002. The remaining $6.9 million reduction in the line-of-credit with Yellow was a capital contribution to SCST from Yellow.

In connection with the Spin-off, SCST issued $100 million in Senior Notes under a $125 million Master Shelf Agreement with Prudential Investment Management, Inc. and certain of its affiliates. SCST also entered into a $50 million Agented Revolving Credit Agreement (the Credit Agreement) with Bank of Oklahoma, N.A., as agent. Proceeds from the Senior Notes and a portion of the Credit Agreement were used for payments due Yellow discussed above.

The $100 million Senior Notes are unsecured with a fixed interest rate of 7.38% and an average maturity of eight years. Payments due under the Senior Notes are interest only until June 30, 2006 and at that time semi-annual principal payments begin, with the final payment due December 2013. Under the terms of the Senior Notes, SCST must maintain several financial covenants including a ratio of total indebtedness to earnings before interest, taxes, depreciation, amortization and rent (EBITDAR), an interest coverage ratio and a tangible net worth, among others.

The $50 million Credit Agreement is unsecured with an interest rate based on LIBOR or prime at the Company’s option, plus an applicable spread, in certain instances, and matures in September 2005. The availability under the Credit Agreement is limited to SCST’s qualified receivables (as defined in the Credit Agreement). At September 30, 2002, SCST had borrowings under the Credit Agreement of $10.7 million and availability of $39.3 million. The remaining portion of the Credit Agreement is available for future capital expenditures, working capital and letter of credit requirements as needed. Under the terms of the Credit Agreement, SCST must maintain several financial covenants including a ratio of total indebtedness to EBITDAR, an interest coverage ratio and a tangible net worth, among others.

At September 30, 2002 Yellow provided on behalf of SCST approximately $3.8 million in outstanding surety bonds. These bonds, issued by insurance companies, serve as collateral support primarily for workers’ compensation programs in states where SCST is self-insured. The price and availability of surety bonds fluctuates over time with general conditions in the insurance market. A lack of availability of surety bonds could result in the need for Yellow to issue additional letters of credit. At September 30, 2002, Yellow has provided on behalf of SCST $29.0 million in outstanding letters of credit. Subsequent to September 30, SCST replaced $15.0 million of the Yellow provided letters of credit with letters of credit drawn upon SCST’s new credit facility. Yellow will continue to provide SCST with the majority of its collateral to support SCST’s various insurance programs for all insurance risks through February 28, 2003. The collateral support by Yellow is expected to remain in place for at least four years from the Spin-off date, but the agreement is not limited to any length of time. However, the agreement does provide for significant increases in the cost to SCST for the collateral support by Yellow after the end of the fourth year.

Projected net capital expenditures for 2002 are $27.5 million, an increase from 2001 net capital expenditures of $19.6 million. Net capital expenditures pertain primarily to replacement of revenue equipment at both subsidiaries and additional investments in information technology, land and structures.

Actual net capital expenditures are summarized in the following table (in millions):

Nine months Year ended Year ended

ended 2002 2001 2000

Land and structures:

Additions
$ 6.6 $ 3.3 $ 11.1

Sales
(1.1 ) — (0.4 )

Revenue equipment
12.2 8.6 38.9

Technology and other
6.7 7.7 9.4

Total
$ 24.4 $ 19.6 $ 59.0

In accordance with accounting principles generally accepted in the United States, our operating leases are not recorded in our balance sheet; however, the minimum lease payments related to these leases are disclosed in the notes to our audited financial statements included in our Information Statement filed under Form 10, and in “Contractual Cash Obligations” below.

CONTRACTUAL CASH OBLIGATIONS

The following tables set forth a summary of our contractual cash obligations and other commercial commitments as of September 30, 2002 (in millions):

Payments Due by Fiscal Year

There-

2002 ⁽¹⁾ 2003 2004 2005 2006 after Total

Contractual Cash Obligations

Recorded Obligations:

Revolving line of credit ⁽²⁾
$ — $ — $ — $ 10.7 $ — $ — $ 10.7

Long-term debt ⁽²⁾
— — — 1.3 6.4 108.7 116.4

Operating leases
2.4 8.1 5.7 3.7 1.8 1.1 22.8

Total contractual obligations
$ 2.4 $ 8.1 $ 5.7 $ 15.7 $ 8.2 $ 109.8 $ 149.9

(1)		Cash obligations for the remainder of 2002.




(2)		See Note 3 to the accompanying financial statements.


		Amount of Commitment Expiration by Fiscal Year

												There-
		2002 ⁽¹⁾		2003		2004		2005		2006		after		Total

Other Commercial Commitments
Available line of credit		$	—	$	—	$	—	$	39.3	$	—	$	—	$	39.3
Letters of credit			—		29.0		—		—		—		—		29.0
Surety bonds			—		5.7		0.1		—		—		—		5.8

	Total commercial commitments	$	—	$	34.7	$	0.1	$	39.3	$	—	$	—	$	74.1

(1)

Commercial obligations for the remainder of 2002.

FORWARD-LOOKING STATEMENTS

Certain statements in this Report, including those contained in “Outlook” and “Financial Condition” are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of SCST. Forward-looking statements include those preceded by, followed by or that include the words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “predict,” “believe” and similar words or expressions. These forward-looking statements involve risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements, because of, among other things, potential risks and uncertainties. These factors include, but are not limited to, general economic conditions; labor relations; governmental regulations; cost and availability of fuel; inclement weather; competitive initiatives and pricing pressures; self insurance claims and other expense volatility; and other financial, operational and legal risks and uncertainties detailed from time to time in other filings with the Securities and Exchange Commission.

As a result of these and other factors, no assurance can be given as to our future results and achievements. Accordingly, a forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. You should not place undue reliance on the forward-looking statements, which speak only as of the date of this Report. We are under no obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

SCST is exposed to a variety of market risks, including the effects of interest rates and fuel prices. The detail of SCST’s debt structure is more fully described in the notes to the financial statements. To mitigate our risk to rising fuel prices, Saia and Jevic each have implemented effective fuel surcharge programs. These programs are well established within the industry and customer acceptance of fuel surcharges remains high. Since the amount of fuel surcharge is based on average national diesel fuel prices and is reset weekly, exposure of SCST to fuel price volatility is significantly reduced.

The following table provides information about SCST third-party financial instruments as of September 30, 2002. The table presents principal cash flows (in millions) and related weighted average interest rates by contractual maturity dates. Weighted average variable rates are based on the prime rate as of September 30, 2002.


	Expected Maturity Date																		2002

																					Fair
	2002			2003			2004			2005			2006			Thereafter			Total		Value

Fixed Rate Debt	$	—		$	—		$	—		$	1.3		$	6.4		$	108.7		$	116.4	$	115.8
Average Interest Rate		0.00	%		0.00	%		0.00	%		7.00	%		7.30	%		7.33	%
Variable Rate Debt	$	—		$	—		$	—		$	10.7		$	—		$	—		$	10.7	$	10.7
Average Interest Rate		0.00	%		0.00	%		0.00	%		4.75	%		0.00	%		0.00	%

Item 4. Controls and Procedures

We maintain a rigorous set of disclosure controls and procedures and internal controls designed to ensure that information required to be disclosed in our filings under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Our principal executive and financial officers have evaluated our disclosure controls and procedures within 90 days prior to the filing of this Quarterly Report on Form 10-Q and have determined that such disclosure controls and procedures are effective.

Subsequent to our evaluation, there were no significant changes in internal controls or other factors that could significantly affect internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings — None

Item 2. Changes in Securities and Use of Proceeds — None

Item 3. Defaults Upon Senior Securities — None

Item 4. Submission of Matters to a Vote of Security Holders — None

Item 5. Other Information — None

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits.

Exhibit

Number Description of Exhibit

3.1 Amended and Restated Certificate of Incorporation of SCS Transportation, Inc.

3.2 Amended and Restated By-laws of SCS Transportation, Inc.

4.1 Rights Agreement between SCS Transportation, Inc. and Mellon Investor Services LLC dated as of September 30, 2002

10.1 Agented Revolving Credit Agreement dated as of September 20, 2002, among SCS Transportation, Inc. and Bank of Oklahoma, N.A., U.S. Bank National Association, Bank One, NA, and Harris Trust and Savings Bank, and Bank of Oklahoma, N.A., as agent for the Banks (incorporated herein by reference to Exhibit 10.1 of SCS Transportation, Inc.’s Form 8-K (File No. 0-49983) filed on October 2, 2002)

10.2 Senior Notes Master Shelf Agreement dated as of September 20, (incorporated herein by reference to Exhibit 10.2 of SCS Transportation, Inc.’s Form 8-K (File No. 0-49983) filed on October 2, 2002)

10.3 Master Separation and Distribution Agreement between Yellow Corporation and SCS Transportation, Inc.

10.4 Tax Indemnification and Allocation Agreement between Yellow Corporation and SCS Transportation, Inc.

99.1 Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.2 Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b) Reports on Form 8-K.

During the quarter ended September 30, 2002, SCS Transportation, Inc. filed no Current Reports on Form 8-K.

Saia Motor Freight Line, Inc.
Financial Information
For the Quarter and Nine Months Ended September 30, 2002 and 2001
(Amounts in thousands)

Third Quarter % Nine Months %

2002 2001 Change 2002 2001 Change

Operating revenue
127,581 125,072 2.0 366,635 367,179 (0.1 )

Operating income
6,526 5,077 16,176 6,577 *

Operating ratio
94.9 95.9 95.6 98.2

Third Quarter

Third Quarter % Amount/Workday %

2002 2001 Change 2002 2001 Change

Workdays
64 63

F/S Revenue
LTL 117,496 115,093 2.1 1,835.9 1,826.9 0.5

TL 10,085 9,979 1.1 157.6 158.4 (0.5 )

Total 127,581 125,072 2.0 1,993.5 1,985.3 0.4

Revenue excluding
LTL 117,572 115,083 2.2 1,837.1 1,826.7 0.6

revenue recognition
TL 10,091 9,978 1.1 157.7 158.4 (0.4 )

adjustment
Total 127,663 125,061 2.1 1,994.8 1,985.3 0.5

Tonnage
LTL 602 574 4.9 9.40 9.10 3.3

TL 138 136 1.3 2.15 2.16 (0.3 )

Total 740 710 4.2 11.55 11.26 2.6

Shipments
LTL 1,131 1,076 5.1 17.67 17.09 3.4

TL 17 16 11.4 0.27 0.25 9.7

Total 1,148 1,092 5.2 17.94 17.34 3.5

Revenue/cwt
LTL 9.77 10.03 (2.6 )

TL 3.67 3.67 (0.1 )

Total 8.63 8.82 (2.1 )

Revenue/cwt
LTL 9.56 9.76 (2.0 )

(excluding fuel surcharge)
TL 3.65 3.63 0.4

Total 7.78 7.89 (1.4 )

Revenue/shipment
LTL 103.96 106.91 (2.8 )

TL 577.78 636.64 (9.2 )

Total 111.17 114.51 (2.9 )

* Nine Months — 2001 Operating income includes $6,705 in one-time integration costs due to the merger of Westex and Action into Saia.

Jevic Transportation, Inc.
Financial Information
For the Quarter and Nine Months Ended September 30, 2002 and 2001
(Amounts in thousands)

Third Quarter % Nine Months %

2002 2001 Change 2002 2001 Change

Operating revenue
73,575 70,080 5.0 214,545 219,585 (2.3 )

Operating income
1,851 1,060 3,650 4,919

Operating ratio
97.5 98.5 98.3 97.8

Third Quarter

Third Quarter % Amount/Workday %

2002 2001 Change 2002 2001 Change

Workdays
64 63

F/S Revenue
LTL 47,170 44,833 5.2 737.0 711.6 3.6

TL 25,054 24,311 3.1 391.5 385.9 1.4

Other 1,351 936 44.3 21.1 14.9 41.6

Total 73,575 70,080 5.0 1,149.6 1,112.4 3.3

Revenue excluding
LTL 46,949 44,964 4.4 733.6 713.7 2.8

revenue recognition
TL 24,941 24,381 2.3 389.7 387.0 0.7

adjustment
Other 1,351 936 44.3 21.1 14.9 41.6

Total 73,241 70,281 4.2 1,144.4 1,115.6 2.6

Tonnage
LTL 249 245 1.6 3.89 3.89 0.0

TL 318 315 1.0 4.97 5.00 (0.5 )

Total 567 560 1.3 8.86 8.89 (0.3 )

Shipments
LTL 209 202 3.9 3.26 3.20 2.3

TL 35 35 1.7 0.55 0.55 —

Total 244 237 3.6 3.81 3.75 2.0

Revenue/cwt
LTL 9.42 9.18 2.7

TL 3.92 3.87 1.3

Total 6.34 6.19 2.3

Revenue/cwt
LTL 9.22 8.93 3.3

(excl. fuel surcharge)
TL 3.84 3.77 1.8

Total 6.20 6.03 2.9

Revenue/shipment
LTL 224.78 223.67 0.5

TL 707.91 703.80 0.6

Total 294.52 294.25 0.1

SIGNATURE

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.

SCS TRANSPORTATION, INC.

Date: November 4, 2002 /s/ James J. Bellinghausen

James J. Bellinghausen
Vice President of Finance and
Chief Financial Officer

CERTIFICATION

I, Herbert A. Trucksess, III, Chairman, President and Chief Executive Officer of SCS Transportation, Inc. (“registrant”), certify that:

1.    I have reviewed this quarterly report on Form 10-Q of the registrant;

2.    Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or 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;

3.    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;

4.    The registrant’s other certifying officer 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:

        a)    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;

        b)    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

        c)    presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5. The registrant’s other certifying officer 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):

a) 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

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and

6. The registrant’s other certifying officer 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.

Date:  November 4, 2002

/s/ Herbert A. Trucksess, III

Herbert A. Trucksess, III
Chairman, President and
Chief Executive Officer

CERTIFICATION

I, James J. Bellinghausen, Vice President of Finance and Chief Financial Officer of SCS Transportation, Inc. (“registrant”) certify that:

Date: November 4, 2002

/s/ James J. Bellinghausen

James J. Bellinghausen
Vice President of Finance and
Chief Financial Officer

EXHIBIT INDEX

Exhibit

Number Description of Exhibit

3.1 Amended and Restated Certificate of Incorporation of SCS Transportation, Inc.

3.2 Amended and Restated By-laws of SCS Transportation, Inc.

4.1 Rights Agreement between SCS Transportation, Inc. and Mellon Investor Services LLC dated as of September 30, 2002

10.1 Agented Revolving Credit Agreement dated as of September 20, 2002, among SCS Transportation, Inc. and Bank of Oklahoma, N.A., U.S. Bank National Association, Bank One, NA, and Harris Trust and Savings Bank, and Bank of Oklahoma, N.A., as agent for the Banks (incorporated herein by reference to Exhibit 10.1 of SCS Transportation, Inc.’s Form 8-K (File No. 0-49983) filed on October 2, 2002)

10.2 Senior Notes Master Shelf Agreement dated as of September 20, (incorporated herein by reference to Exhibit 10.2 of SCS Transportation, Inc.’s Form 8-K (File No. 0-49983) filed on October 2, 2002)

10.3 Master Separation and Distribution Agreement between Yellow Corporation and SCS Transportation, Inc.

10.4 Tax Indemnification and Allocation Agreement between Yellow Corporation and SCS Transportation, Inc.

99.1 Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.2 Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

E-1

EXHIBIT 3.1

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION
OF
SCS TRANSPORTATION, INC.

The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on February 4, 2000 under the name of ABC Trucking, Inc., and was amended to change the name of the Corporation to SCS Transportation, Inc. by Certificate of Amendment filed on October 1, 2001.

This Amended and Restated Certificate of Incorporation has been duly proposed by resolutions adopted and declared advisable by the Board of Directors of the Corporation, duly adopted by the sole stockholder of the Corporation and duly executed and acknowledged by the officers of the Corporation in accordance with Sections 103, 228, 242 and 245 of the General Corporation Law of the State of Delaware.

This Amended and Restated Certificate of Incorporation shall become effective at 5:00 p.m., Eastern time, on September 30, 2002 (the "Effective Date").

The text of the Certificate of Incorporation is hereby amended and restated to read in its entirety as follows:

Article I

NAME

Section 1.01 The name of the Corporation is "SCS Transportation, Inc." (hereinafter referred to as the "Corporation").

Article II

REGISTERED AGENT

Section 2.01 The address of the registered office of the Corporation in the State of Delaware is 1209 Orange Street, Wilmington, County of New Castle, Delaware, 19801. The name of the registered agent of the Corporation at such address is The Corporation Trust Company.

-2-

Article III

PURPOSE

Section 3.01 The purpose of the Corporation is to engage in any lawful act or activity for which corporations may now or hereafter be organized and incorporated under the General Corporation Law of the State of Delaware (the "DGCL").

Article IV

AUTHORIZED CAPITAL STOCK

The total number of shares of stock which the Corporation shall have authority to issue is 50,050,000 shares. Such shares shall consist of 50,000 shares of preferred stock, par value $0.001 per share, amounting to $50 in the aggregate and 50,000,000 shares of common stock, par value $0.001 per share, amounting to $50,000 in the aggregate.

Section 4.01 Preferred Stock.

(a) The preferred stock of the Corporation may be issued from time to time in one or more series of any number of shares, provided that the aggregate number of shares issued and not canceled in any and all such series shall not exceed the total number of shares of preferred stock authorized above.

(b) The Board of Directors is authorized, subject to any limitations prescribed by law, to provide for the issuance of preferred stock from time to time, in one or more series, by resolution or resolutions and the filing of a certificate pursuant to the DGCL, to establish the designations, preferences and rights of each such series and any qualifications, limitations or restrictions thereof.

Section 4.02 Common Stock.

(a) The common stock of the Corporation may be issued from time to time in one or more series of any number of shares, provided that the aggregate number of shares issued and not canceled in any and all such series shall not exceed the total number of shares of common stock authorized above.

(b) The Board of Directors is authorized, subject to any limitations prescribed by law, to provide for the issuance of common stock from time to time, in one or more series, by resolution or resolutions and the filing of a certificate pursuant to the DGCL, to establish the designations, preferences and rights of each such series and any qualifications, limitations or restrictions thereof.

-3-

(c) Without limiting the generality of the foregoing, shares of a series of common stock consisting of 20,000,000 shares, or such larger number of shares as the Board of Directors shall from time to time fix by resolution or resolutions, may be issued from time to time by the Board of Directors. Shares of this series shall be designated, and are hereinafter called "Common Stock." The holders of record of the Common Stock shall be entitled to the following rights:

(i) to vote at all meetings of stockholders of the Corporation, and such holders shall have one vote at all such meetings in respect of each share of Common Stock held of record by them;

(ii) subject to the prior rights of the holders of all classes or series of preferred stock or common stock other than Common Stock, to receive when, if and as declared by the Board of Directors out of the assets of the Corporation legally available therefor, such dividends as may be declared by the Corporation from time to time to holders of Common Stock; and

(iii) subject to the prior rights of the holders of all classes or series of preferred stock or common stock other than Common Stock, at the time outstanding having prior rights as to distribution of assets upon liquidation, dissolution or winding-up, to receive the remaining assets of the Corporation upon liquidation, dissolution or winding-up.

Article V

STOCKHOLDER ACTION

Section 5.01 Except as otherwise fixed by or pursuant to the provisions of Article IV hereof relating to the rights of the holders of any class or series of preferred stock or common stock other than Common Stock, (a) all action required or permitted to be taken by stockholders of the Corporation shall be taken at a duly called annual or special meeting and no action may be taken by written consent and (b) special meetings of stockholders of the Corporation for any purpose or purposes may be called only by (i) the Board of Directors pursuant to a resolution stating the purpose or purposes thereof approved by a majority of the total number of Directors which the Corporation would have if there were no vacancies (the "Whole Board"), (ii) the Chairman of the Board of Directors, or (iii) the Chief Executive Officer of the Corporation.

-4-

Article VI

BOARD OF DIRECTORS; ELECTION

Section 6.01 Number, Election and Terms. Except as otherwise fixed by or pursuant to the provisions of Article IV hereof relating to the rights of the holders of any class or series of preferred stock or common stock other than Common Stock, the number of the Directors shall be fixed from time to time exclusively pursuant to a resolution adopted by a majority of the Whole Board (which shall in no event be less than three). The Directors, other than those who may be elected by the holders of any class or series of preferred stock or common stock other than Common Stock, shall be classified, with respect to the time for which they severally hold office, into three classes, as nearly equal in number as possible, one class to be originally elected for a term expiring at the first annual meeting of stockholders after the Effective Date, another class to be originally elected for a term expiring at the second annual meeting of stockholders after the Effective Date, and another class to be originally elected for a term expiring at the third annual meeting of stockholders after the Effective Date, with each class to hold office until their successors are duly elected and qualified. At each succeeding annual meeting of the stockholders, successors to the class of Directors whose terms expire at such annual meeting shall be elected for three-year terms, with members of each class to hold office until their successors are duly elected and qualified.

Section 6.02 Election of Directors. Unless and except to the extent that the By-laws of the Corporation (the "By-laws") shall so require, the election of Directors of the Corporation need not be by written ballot.

Article VII

AMENDMENT OF CERTIFICATE OF INCORPORATION

Section 7.01 The Corporation reserves the right at any time from time to time to amend, alter, change or repeal any provision contained in this Amended and Restated Certificate of Incorporation, and any other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted, in the manner now or hereafter prescribed by law; and, except as set forth in Article VIII, all rights, preferences and privileges of whatsoever nature conferred upon stockholders, Directors or any other persons whomsoever by and pursuant to this Amended and Restated Certificate of Incorporation in its present form or as hereafter amended are granted subject to the right reserved in this Article. Notwithstanding anything contained in this Certificate of Incorporation to the contrary, the affirmative vote of the holders of at least two-thirds of the voting power of all shares of the Corporation entitled to vote generally in the election of Directors then outstanding, voting together as a single class, shall be required to alter, amend, adopt any provision inconsistent with or repeal Article V, Article VI, Article VII, and Article VIII.

-5-

Article VIII

EXCULPATION; INDEMNIFICATION

Section 8.01 Exculpation of Directors. A Director shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a Director, except, if required by the DGCL, for liability (a) for any breach of the Director's duty of loyalty to the Corporation or its stockholders, (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (c) under
Section 174 of the DGCL, or (d) for any transaction from which the Director derived an improper personal benefit. Neither the amendment nor repeal of this
Section 8.01 shall eliminate or reduce the effect of this Section 8.01 in respect of any matter occurring, or any cause of action, suit or claim that, but for this Section 8.01 would accrue or arise, prior to such amendment or repeal.

Section 8.02 Indemnification and Insurance.

(a) Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), by reason of the fact that such person, or a person of whom such person is the legal representative, is or was a Director or officer of the Corporation or, while a Director or officer of the Corporation, is or was serving at the request of the Corporation as a Director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such proceeding is alleged action in an official capacity as a Director, officer, employee or agent or in any other capacity while serving as a Director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the DGCL, as the same exists or may hereafter be amended, against all expense, liability and loss (including attorneys' fees, judgments, fines, amounts paid or to be paid in settlement and excise taxes or penalties arising under the Employee Retirement Income Security Act of 1974, as in effect from time to time) reasonably incurred or suffered by such person in connection therewith and such indemnification shall continue as to a person who has ceased to be a Director, officer, employee or agent and shall inure to the benefit of such person's heirs, executors and administrators; provided, however, that, except as provided in paragraph (b) hereof, the Corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors. The Corporation shall pay the expenses incurred in defending any such proceeding in advance of its final disposition; any advance payments shall be paid by the Corporation within 20 calendar days after the receipt by the Corporation of a statement or statements from the

-6-

claimant requesting such advance or advances from time to time; provided, however, that, if and to the extent the DGCL requires, the payment of such expenses incurred by a Director or officer in such person's capacity as a Director or officer (and not in any other capacity in which service was or is rendered by such person while a Director or officer, including, without limitation, service to an employee benefit plan) in advance of the final disposition of a proceeding, shall be made only upon delivery to the Corporation of an undertaking, by or on behalf of such Director or officer, to repay all amounts so advanced if it shall ultimately be determined that such Director or officer is not entitled to be indemnified under this Section 8.02 or otherwise. The Corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification, and rights to have the Corporation pay the expenses incurred in defending any proceeding in advance of its final disposition, to any employee or agent of the Corporation to the fullest extent of the provisions of this Article with respect to the indemnification and advancement of expenses of Directors and officers of the Corporation.

(b) Right of Claimant to Bring Suit. If a claim under paragraph (a) of this Section 8.02 is not paid in full by the Corporation within 30 calendar days after a written claim has been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the Corporation) that the claimant has not met the standard of conduct which makes it permissible under the DGCL for the Corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper under the circumstances because the claimant has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

(c) Non-Exclusivity of Rights. The right to indemnification and the payment of expenses incurred in defending a proceeding in advance of its final disposition conferred in this Section 8.02 shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, provision of this Amended and Restated Certificate of Incorporation, By-law, agreement, vote of stockholders or disinterested Directors or otherwise. No repeal or modification of this Article shall in any way diminish or adversely affect the rights

-7-

of any Director, officer, employee or agent of the Corporation hereunder in respect of any occurrence or matter arising prior to any such repeal or modification.

(d) Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any Director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any such expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the DGCL.

(e) Severability. If any provision or provisions of this Article VIII shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (i) the validity, legality and enforceability of the remaining provisions of this Article VIII (including, without limitation, each portion of any paragraph of this Article VIII containing any such provision held to be invalid, illegal or unenforceable, that is not itself held to be invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby; and (ii) to the fullest extent possible, the provisions of this Article VIII (including, without limitation, each such portion of any paragraph of this Article VIII containing any such provision held to be invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.

IN WITNESS WHEREOF, the Corporation has caused this Amended and Restated Certificate of Incorporation to be signed by its Chief Executive Officer and attested by its Secretary this 26th day of September, 2002.

/s/  Herbert A. Trucksess
---------------------------------
Herbert A. Trucksess, III
Chief Executive Officer


/s/  James J. Bellinghausen
---------------------------------
James J. Bellinghausen
Secretary
this 26th day of September, 2002.

EXHIBIT 3.2

AMENDED AND RESTATED BY-LAWS
OF
SCS TRANSPORTATION, INC.

ARTICLE I
OFFICES AND RECORDS

SECTION 1.01 Delaware Office. The principal office of SCS Transportation, Inc. (the "Corporation") in the State of Delaware shall be located in the City of Wilmington, County of New Castle, and the name and address of its registered agent is The Corporation Trust Company, 1209 Orange Street, Wilmington, Delaware 19801.

SECTION 1.02 Other Offices. The Corporation may have such other offices, either within or without the State of Delaware, as the board of directors of the Corporation (the "Board of Directors", and each member thereof, a "Director") may designate or as the business of the Corporation may from time to time require.

SECTION 1.03 Books and Records. The books and records of the Corporation may be kept outside the State of Delaware at such place or places as may from time to time be designated by the Board of Directors.

ARTICLE II
STOCKHOLDERS

SECTION 2.01 Annual Meeting. The annual meeting of the stockholders of the Corporation shall be held on such date and at such time as may be fixed by resolution of the Board of Directors.

SECTION 2.02 Special Meeting. Except as otherwise required by law and subject to the rights of the holders of any class or series of stock having a preference over the common stock, par value $0.001 per share, of the Corporation (the "Common Stock") as to dividends or upon liquidation, special meetings of stockholders of the Corporation for any purpose or purposes may be called only by (a) the Board of Directors pursuant to a resolution stating the purpose or purposes thereof approved by a majority of the total number of Directors which the Corporation would have if there were no vacancies (the "Whole Board"), (b) the Chairman of the Board of Directors (the "Chairman of the Board"), or (c) the Chief Executive Officer of the Corporation (the "Chief Executive Officer"). Only such business brought before the meeting pursuant to the Corporation's notice of meeting shall be conducted at a special meeting of stockholders.

SECTION 2.03 Place of Meeting. The Board of Directors, the Chairman of the Board, or the Chief Executive Officer, as the case may be, may designate the place, if any, of meeting for any annual meeting or for any special meeting of the stockholders. If no designation is so made, the place of meeting shall be the principal office of the Corporation.

SECTION 2.04 Notice of Meeting. Notice, stating the place, day and hour of the meeting and the purpose or purposes for which the meeting is called, shall be delivered by the Corporation not less than ten (10) calendar days nor more than sixty (60) calendar days before the date on which the meeting is to be held, either personally, by mail or by other lawful means, to each

stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail with postage thereon prepaid, addressed to the stockholder at such person's address as it appears on the stock transfer books of the Corporation. Such further notice shall be given as may be required by law. Meetings may be held without notice if all stockholders entitled to notice are present (except when stockholders entitled to notice attend the meeting for the express purpose of objecting, at the beginning of the meeting, because the meeting is not lawfully called or convened), or if notice is waived by those not present in accordance with Section 6.04. Any previously scheduled meeting of the stockholders may be postponed, and any special meeting of the stockholders may be canceled, by resolution of the Board of Directors upon public notice given prior to the date previously scheduled for such meeting of stockholders.

SECTION 2.05 Quorum and Adjournment; Voting. Except as otherwise provided by law or by the Certificate of Incorporation, the holders of a majority of the voting power of all outstanding shares of the Corporation entitled to vote generally in the election of Directors (the "Voting Stock") represented in person or by proxy, shall constitute a quorum at a meeting of stockholders, except that when specified business is to be voted on by a class or series of stock voting as a class, the holders of a majority of the shares of such class or series shall constitute a quorum of such class or series for the transaction of such business. The chairman of the meeting may adjourn the meeting from time to time, whether or not there is such a quorum. No notice of the time and place of adjourned meetings need be given except as required by law. The stockholders present at a duly called meeting at which a quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

SECTION 2.06 Proxies. At all meetings of stockholders, a stockholder may vote by proxy executed in writing (or in such manner prescribed by the General Corporation Law of the State of Delaware (the "DGCL")) by the stockholder, or by such person's duly authorized attorney in fact.

SECTION 2.07 Notice of Stockholder Business and Nominations.

(a) Annual Meetings of Stockholders.

(i) Nominations of persons for election to the Board of Directors and the proposal of business to be considered by the stockholders may be made at an annual meeting of stockholders (A) pursuant to the Corporation's notice of meeting pursuant to Section 2.04, (B) by or at the direction of the Board of Directors, or (C) by any stockholder of the Corporation who was a stockholder of record at the time of giving of notice provided for in this By-Law, who is entitled to vote at the meeting and who complies with the notice procedures set forth in this By-Law.

(ii) For nominations or other business to be properly brought before an annual meeting by a stockholder pursuant to clause (C) of paragraph (a)(i) of this Section 2.07, the stockholder must have given timely notice thereof in writing to the Secretary of the Corporation and such other business must otherwise be a proper matter for stockholder action. To be timely, a stockholder's notice must be delivered or mailed to and received at the principal executive offices of the Corporation and such other business must otherwise be delivered or mailed to and received at the principal executive offices of the Corporation not later than the close of business on the 90th calendar day nor earlier than the 120th calendar day prior to the

anniversary date of the first mailing of the Corporation's proxy statement for the immediately preceding year's annual meeting. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a stockholder's notice as described above. Such stockholder's notice shall set forth the following items:

(A) as to each person whom the stockholder proposes to nominate for election or reelection as a Director all information relating to such person that is required to be disclosed in solicitations of proxies for election of Directors in an election contest, or is otherwise required, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the "Exchange Act") and Rule 14a-11 thereunder (including such person's written consent to being named in the proxy statement as a nominee and to serving as a Director if elected);

(B) as to any other business that the stockholder proposes to bring before the meeting, a brief description of the business desired to be brought before the meeting, the text of the proposal or business (including the text of any resolutions proposed for consideration and in the event that such business includes a proposal to amend these By-Laws, the language of the proposed amendment), the reasons for conducting such business at the meeting and any material interest in such business of such stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and

(C) as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (1) the name and address of such stockholder and of such beneficial owner, as they appear on the Corporation's books, (2) the class and number of shares of the Corporation which are owned beneficially and of record by such stockholder and such beneficial owner, (3) a representation that the stockholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such business or nomination, and (4) a representation whether the stockholder or the beneficial owner, if any, intends or is part of a group which intends (x) to deliver a proxy statement and/or form of proxy to holders of at least the percentage of the Corporation's outstanding capital stock required to approve or adopt the proposal or elect the nominee and/or (y) otherwise to solicit proxies from stockholders in support of such proposal or nomination.

The foregoing notice requirements shall be deemed satisfied by a stockholder if the stockholder has notified the Corporation of his or her intention to present a proposal at an annual meeting in compliance with Rule 14a-8 (or any successor thereof) promulgated under the Exchange Act and such stockholder's proposal has been included in a proxy statement that has been prepared by the Corporation to solicit proxies for such annual meeting. The Corporation may require any proposed nominee to furnish such other information as it may reasonably require to determine the eligibility of such proposed nominee to serve as a Director.

(iii) Notwithstanding anything in the second sentence of paragraph (a)(ii) of this Section 2.07 to the contrary, in the event that the number of Directors to be elected to the Board of Directors is increased and there is no public announcement by the Corporation naming all of the nominees for Director or specifying the size of the increased Board of Directors at least 30 calendar days before the date of the annual meeting, a stockholder's notice required by this By-Law shall also be considered timely (but only with respect to nominees for any new positions created by such increase) if it shall be delivered to the Secretary at the principal executive offices of the Corporation not later than the close of business on the 10th calendar day following the day on which such public announcement is first made by the Corporation.

(b) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation's notice of meeting under Section 2.04. Nominations of persons for election to the Board of Directors may be made at a special meeting of stockholders at which Directors are to be elected pursuant to the Corporation's notice of meeting (i) by or at the direction of the Board of Directors, or
(ii) provided that the Board of Directors has determined that Directors shall be elected at such meeting, by any stockholder of the Corporation who is a stockholder of record at the time of giving of notice provided for in this By-Law, who shall be entitled to vote at the meeting and who complies with the notice procedures set forth in this By-Law. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more Directors to the Board of Directors, any stockholder may nominate a person or persons (as the case may be) for election to such position(s) as specified in the Corporation's notice of meeting by complying with the stockholder's notice requirement of paragraph (a)(ii) of this Section 2.07 and delivering such notice to the Secretary at the principal executive offices of the Corporation not earlier than the close of business on the 120th calendar day prior to such special meeting and not later than the close of business on the later of the 90th calendar day prior to such special meeting or the 10th calendar day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. In no event shall the public announcement of an adjournment of a special meeting commence a new time period for the giving of a stockholder's notice as described above.

(i) Only such persons who are nominated in accordance with the procedures set forth in this Section 2.07 shall be eligible to serve as Directors and

only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this By-Law. Except as otherwise provided by law, the Certificate of Incorporation or these By-Laws, the chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 2.07 (including whether the stockholder or beneficial owner, if any, on whose behalf the nomination or proposal is made solicited (or is part of a group which solicited) or did not so solicit, as the case may be, proxies in support of such stockholder's nominee or proposal in compliance with such stockholder's representation as required by clause
(a)(ii)(C)(4) of this Section 2.07) and, if any proposed nomination or business is not in compliance with this By-Law, to declare that such defective proposal or nomination shall be disregarded. Notwithstanding the foregoing provisions of this
Section 2.07, if the stockholder (or a qualified representative of the stockholder) does not appear at the annual or special meeting of stockholders of the Corporation to present a nomination or business, such nomination shall be disregarded and such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Corporation.

(ii) For purposes of this By-Law, "public announcement" shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or comparable national news service or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act.

(iii) Notwithstanding the foregoing provisions of this
Section 2.07, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Section 2.07. Nothing in this Section 2.07 shall be deemed to affect any rights (a) of stockholders to request inclusion of proposals in the Corporation's proxy statement pursuant to Rule 14a-8 under the Exchange Act or (b) of the holders of any series of preferred stock of the Corporation ("Preferred Stock") to elect Directors in accordance with the rights of such Preferred Stock as contained in the Certificate of Incorporation.

SECTION 2.08 Procedure for Election of Directors; Required Vote for Other Matters. Election of Directors at all meetings of the stockholders at which Directors are to be elected shall be by ballot, and, subject to the rights of the holders of any series of Preferred Stock to elect Directors contained in the Certificate of Incorporation, a plurality of the votes cast thereat shall elect Directors. Except as otherwise provided by law, the Certificate of Incorporation, applicable stock exchange rules or other rules and regulations applicable to the Corporation or these By-Laws, in all matters other than the election of Directors, the affirmative vote of a majority of the voting power of the shares present in person or represented by proxy at the meeting and entitled to vote on the matter shall be the act of the stockholders.

SECTION 2.09 Inspectors of Elections; Opening and Closing the Polls.

(a) The Board of Directors by resolution shall appoint, or authorize an officer of the Corporation to appoint, one or more inspectors, which inspector or inspectors may include individuals who serve the Corporation in other capacities, including, without limitation, as officers, employees, agents or representatives, to act at the meetings of stockholders and make a written report thereof. One or more persons may be designated as alternate inspector(s) to replace any inspector who fails to act. If no inspector or alternate has been appointed to act or is able to act at a meeting of stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before discharging such person's duties shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such person's ability. The inspector(s) shall have the duties prescribed by law.

(b) The date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at a meeting shall be announced at the meeting by the person presiding over the meeting. The Board of Directors may adopt by resolution such rules and regulations for the conduct of the meeting of stockholders as it shall deem appropriate. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the person presiding over any meeting of stockholders shall have the right and authority to convene and to adjourn the meeting, to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such presiding officer, are appropriate for the proper conduct of the meeting. Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the presiding officer of the meeting, may include, without limitation, the following:
(i) an agenda or order of business for the meeting; (ii) rules and procedures for maintaining order at the meeting and the safety of those present; (iii) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (iv) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (v) limitations on the time allotted to questions or comments by participants. The presiding officer at any meeting of stockholders in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine and declare to the meeting that a matter or business was not properly brought before the meeting and if such presiding officer should so determine, such person shall so declare to the meeting that any such matter or business not properly brought before the meeting shall not be transacted or considered. Unless and to the extent determined by the Board of Directors or the person presiding over the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.

ARTICLE III
BOARD OF DIRECTORS

SECTION 3.01 General Powers. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authorities by these By-Laws expressly conferred upon them, the Board of Directors may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws required to be exercised or done by the stockholders.

SECTION 3.02 Chairman of the Board. The Board of Directors shall elect a member of the Board of Directors as Chairman of the Board at its first meeting after every annual meeting of stockholders. The Chairman of the Board shall hold office until his successor is elected and qualified or until his earlier resignation, removal from office (as Chairman of the Board or director) or death except as otherwise required by law. The Chairman of the Board shall preside at all meetings of the stockholders and of the Board of Directors. The Chairman of the Board may also serve as an officer of the Corporation, if so elected by the Board of Directors. The Directors also may elect a Vice-Chairman to act in the place of the Chairman of the Board upon his or her absence or inability to act.

SECTION 3.03 Regular Meetings. A regular meeting of the Board of Directors shall be held without other notice than this By- Law in conjunction with the annual meeting of stockholders. The Board of Directors may, by resolution, provide the time and place for the holding of additional regular meetings without other notice than such resolution.

SECTION 3.04 Special Meetings. Special meetings of the Board of Directors shall be called at the request of the Chairman of the Board, the Chief Executive Officer or a majority of the Board of Directors then in office. The person or persons authorized to call special meetings of the Board of Directors may fix the place and time of the meetings.

SECTION 3.05 Notice. Notice of any special meeting of Directors shall be given to each Director at such person's business or residence in writing by hand delivery, first-class or overnight mail or courier service, telegram or facsimile transmission, orally by telephone or any other lawful means. If mailed by first-class mail, such notice shall be deemed adequately delivered when deposited in the United States mails so addressed, with postage thereon prepaid, at least 5 calendar days before such meeting. If by telegram, overnight mail or courier service, such notice shall be deemed adequately delivered when the telegram is delivered to the telegraph company or the notice is delivered to the overnight mail or courier service company at least 24 hours before such meeting. If by facsimile transmission, such notice shall be deemed adequately delivered when the notice is transmitted at least 12 hours before such meeting. If by telephone, by hand delivery or by other lawful means, the notice shall be given at least 12 hours prior to the time set for the meeting. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice of such meeting, except for amendments to these By-Laws, as provided under Section
8.01. A meeting may be held at any time without notice if all the Directors are present (except when Directors attend for the express purpose of objecting, at the beginning of the meeting, because it is not lawfully called or conveyed) or if those not present waive notice of the meeting either before or after such meeting.

SECTION 3.06 Action By Consent of Board of Directors. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if all members of the Board of Directors or committee, as the case may be, consent thereto in accordance with applicable law.

SECTION 3.07 Conference Telephone Meetings. Members of the Board of Directors or any committee thereof may participate in a meeting of the Board of Directors or such committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at such meeting.

SECTION 3.08 Quorum. Subject to Article VII of the Certificate of Incorporation, a whole number of Directors equal to at least a majority of the Whole Board shall constitute a quorum for the transaction of business, but if at any meeting of the Board of Directors there shall be less than a quorum present, a majority of the Directors present may adjourn the meeting from time to time without further notice. The act of the majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board of Directors.

SECTION 3.09 Executive and Other Committees.

(a) The Board of Directors may designate an Executive Committee to exercise, subject to applicable provisions of law, all the powers of the Board of Directors in the management of the business and affairs of the Corporation when the Board of Directors is not in session, including without limitation the power to declare dividends, to authorize the issuance of the Corporation's capital stock and to adopt a certificate of ownership and merger pursuant to Section 253 of the DGCL, by resolution similarly adopted, designate one or more other committees. The Executive Committee and each such other committee shall consist of one or more Directors. The Board of Directors may designate one or more Directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Any such committee, other than the Executive Committee (the powers of which are expressly provided for herein), may to the extent permitted by law exercise such powers and shall have such responsibilities as shall be specified in the designating resolution. In the absence or disqualification of any member of such committee or committees, the member or members thereof present at any meeting and not disqualified from voting, whether or not constituting a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Each committee shall keep written minutes of its proceedings and shall report such proceedings to the Board of Directors when required.

(b) A majority of any committee may determine its action and fix the time and place of its meetings, unless the Board of Directors shall otherwise provide. Notice of such meetings shall be given to each member of the committee in the manner provided for in
Section 3.05. The Board of Directors shall have power at any time to fill vacancies in, to change the membership of or to dissolve any such committee. Nothing herein shall be deemed to prevent the Board of Directors from appointing one or more committees consisting in whole or in part of persons who are not Directors; provided, however, that no such committee shall have or may exercise any authority of the Board of Directors.

SECTION 3.10 Records. The Board of Directors shall cause to be kept a record containing the minutes of the proceedings of the meetings of the Board of Directors and of the stockholders, appropriate stock books and registers and such books of records and accounts as may be necessary for the proper conduct of the business of the Corporation.

SECTION 3.11 Compensation of Directors. Directors, as such, may receive, pursuant to resolution of the Board of Directors, fixed fees and other compensation for their services as directors, including, without limitation, their services as members of committees of the directors.

ARTICLE IV
OFFICERS

SECTION 4.01 Elected Officers. The elected officers of the Corporation shall consist of a Chief Executive Officer, a President (who may be, but need not be, the Chief Executive Officer), a Secretary, and a Chief Financial Officer. The Board of Directors may elect such additional officers as it deems necessary, including Vice Presidents and Assistant Secretaries. All officers elected by the Board of Directors shall each have such powers and duties as generally pertain to their respective offices, subject to the specific provisions of this Article IV. Such officers shall also have such powers and duties as from time to time may be conferred by the Board of Directors or by any committee thereof. Any number of offices may be held by the same individual, except that the offices of President and Secretary may not be held by the same individual.

SECTION 4.02 Election and Term of Office. The elected officers of the Corporation shall be elected annually by the Board of Directors at the regular meeting of the Board of Directors held in conjunction with the annual meeting of the stockholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as convenient. Each officer shall hold office until such person's successor shall have been duly elected and shall have qualified or until such person's death or until he shall resign or be removed pursuant to Section 4.08.

SECTION 4.03 Chief Executive Officer. The Chief Executive Officer shall be the senior officer of the Corporation and shall be responsible for the supervision and control of all of the business and affairs of the Corporation. In addition, he shall perform all such other duties as are properly required of him by the Board of Directors. He shall make reports to the Board of Directors and the stockholders, and shall see that all orders and resolutions of the Board of Directors and of any committee thereof are carried into effect.

SECTION 4.04 President. The President shall act in a general executive capacity and shall assist the Chief Executive Officer in the administration and operation of the Corporation's business and general supervision of its policies and affairs. The President shall act in the place of the Chief Executive Officer in his absence or in the event of his death, inability or refusal to act. He shall perform all duties and have all powers which are delegated him by the Board of Directors or the Chief Executive Officer. He shall have power to sign all stock certificates, contracts and other instruments of the Corporation which are authorized. In the event of the absence, death, inability or refusal to act of the President, the officer designated by the Board of Directors shall perform the duties and exercise the powers of the President. If the Board of Directors does not elect a Chief Executive Officer, the President shall also perform the duties and exercise the powers of the Chief Executive Officer.

SECTION 4.05 Vice Presidents. Each Senior Vice President, Executive Vice President and any Vice President shall have such powers and shall perform such duties as from time to time may be assigned by the Board of Directors, the Chief Executive Officer or the President.

SECTION 4.06 Chief Financial Officer. The Chief Financial Officer shall exercise general supervision over the receipt, custody and disbursement of corporate funds. The Chief Financial Officer shall cause the funds of the Corporation to be deposited in such banks as may be authorized by the Board of Directors, or in such banks as may be designated as depositories in the manner provided by resolution of the Board of Directors. In general, the Chief Financial Officer shall perform the duties incident to the office of Chief Financial Officer

and such further duties as from time to time may be assigned by the Board of Directors, the Chief Executive Officer or the President.

SECTION 4.07 Secretary. The Secretary shall keep or cause to be kept in one or more books provided for that purpose, the minutes of all meetings of the Board of Directors, the committees of the Board of Directors and the stockholders. The Secretary shall see that the books, reports, statements, certificates and other documents and records required by law to be kept and filed are properly kept and filed. The Secretary shall see that all notices are duly given in accordance with the provisions of these By-Laws and as required by law and shall be custodian of the records and the seal of the Corporation. In general, the Secretary shall perform all the duties incident to the office of Secretary and such other duties as from time to time may be assigned by the Board of Directors, the Chief Executive Officer or the President.

SECTION 4.08 Removal. Any officer elected, or agent appointed, by the Board of Directors may be removed by the affirmative vote of a majority of the Board of Directors whenever, in their judgment, the best interests of the Corporation would be served thereby. Any officer or agent appointed by the Chief Executive Officer or the President may be removed by him or her whenever, in such person's judgment, the best interests of the Corporation would be served thereby. No elected officer shall have any contractual rights against the Corporation for compensation by virtue of such election beyond the date of the election of such person's successor, such person's death, such person's resignation or such person's removal, whichever event shall first occur, except as otherwise provided in an employment contract or under an employee benefit plan.

SECTION 4.09 Vacancies. A newly created elected office and a vacancy in any elected office because of death, resignation, or removal may be filled by the Board of Directors for the unexpired portion of the term at any meeting of the Board of Directors. Any vacancy in an office appointed by the Chief Executive Officer or the President because of death, resignation, or removal may be filled by the Chief Executive Officer or the President.

ARTICLE V
STOCK CERTIFICATES AND TRANSFERS

SECTION 5.01 Stock Certificates. The interest of each stockholder of the Corporation shall be evidenced by certificates for shares of stock in such form as the Corporation may from time to time prescribe. The certificates of stock shall be signed, countersigned and registered in such manner as the Board of Directors may by resolution prescribe or as may otherwise be permitted by applicable law, which resolution may permit all or any of the signatures on such certificates to be in facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the date of issue. Notwithstanding the foregoing provisions regarding share certificates, the Corporation may provide that, subject to the rights of stockholders under applicable law, some or all of any or all classes or series of the Corporation's common or any preferred shares may be uncertificated shares.

SECTION 5.02 Transfers of Stock. The shares of the stock of the Corporation shall be transferred on the books of the Corporation by the holder thereof in person

or by such person's attorney, upon surrender for cancellation of certificates for at least the same number of shares, with an assignment and power of transfer endorsed thereon or attached thereto, duly executed, with such proof of the authenticity of the signature as the Corporation or its agents may reasonably require.

SECTION 5.03 Registered Shareholders. The Corporation shall be entitled to treat the holder of record of any share or shares as the holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by law.

SECTION 5.04 Fixing of Record Date. The Board of Directors may fix in advance a date, not exceeding sixty (60) days preceding the date of any meeting of stockholders, or the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of shares shall go into effect, as a record date for the determination of the stockholders entitled to notice of, and to vote at any such meeting and any adjournment thereof, or entitled to receive payment of any such dividend, or to any such allotment of rights, or entitled to exercise the rights in respect of any such change, conversion or exchange of shares. In such case only the stockholders who are stockholders of record on the record date so fixed shall be entitled to such notice of and to vote at such meeting and any adjournment thereof, or to receive payment of such dividend, or to receive such allotment of rights, or to exercise such rights as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the date of closing of the transfer books or the record date fixed as aforesaid.

SECTION 5.05 Lost, Stolen or Destroyed Certificates. No certificate for shares of stock in the Corporation shall be issued in place of any certificate alleged to have been lost, destroyed or stolen, except on production of such evidence of such loss, destruction or theft and on delivery to the Corporation of a bond of indemnity in such amount, upon such terms and secured by such surety, as the Board of Directors or any financial officer may in its or such person's discretion require.

ARTICLE VI
MISCELLANEOUS PROVISIONS

SECTION 6.01 Fiscal Year. The fiscal year of the Corporation shall begin on the first day of January and end on the last day of December of each year.

SECTION 6.02 Dividends. The Board of Directors may from time to time declare, and the Corporation may pay, dividends on its outstanding shares in the manner and upon the terms and conditions provided by law and the Certificate of Incorporation.

SECTION 6.03 Seal. The corporate seal shall have inscribed thereon the words "Corporate Seal," the year of incorporation and the word "Delaware."

SECTION 6.04 Waiver of Notice. Whenever any notice is required to be given to any stockholder or Director under the provisions of the DGCL or these By-Laws, a waiver thereof given in accordance with applicable law shall be deemed equivalent to the giving of such

notice. Neither the business to be transacted at, nor the purpose of, any annual or special meeting of the stockholders or the Board of Directors or committee thereof need be specified in any waiver of notice of such meeting.

SECTION 6.05 Audits. The accounts, books and records of the Corporation shall be audited upon the conclusion of each fiscal year by an independent certified public accountant selected by the Board of Directors, and it shall be the duty of the Board of Directors to cause such audit to be done annually.

SECTION 6.06 Resignations. Any Director or any officer, whether elected or appointed, may resign at any time by giving written notice of such resignation to the Chairman of the Board, the Chief Executive Officer, the President or the Secretary, and such resignation shall be deemed to be effective as of the close of business on the date said notice is received by the Chairman of the Board, the Chief Executive Officer, the President, or the Secretary, or at such later time as is specified therein. No formal action shall be required of the Board of Directors or the stockholders to make any such resignation effective.

ARTICLE VII
CONTRACTS, PROXIES, ETC.

SECTION 7.01 Contracts. Except as otherwise required by law, the Certificate of Incorporation or these By-Laws, any contracts or other instruments may be executed and delivered in the name and on the behalf of the Corporation by such officer or officers of the Corporation as the Board of Directors may from time to time direct. Such authority may be general or confined to specific instances as the Board of Directors may determine. The Chief Executive Officer, the President or any Vice President may execute bonds, contracts, deeds, leases and other instruments to be made or executed or for or on behalf of the Corporation. Subject to any restrictions imposed by the Board of Directors, either the Chief Executive Officer, the President or any Vice President of the Corporation may delegate contractual powers to others under such person's jurisdiction, it being understood, however, that any such delegation of power shall not relieve such officer of responsibility with respect to the exercise of such delegated power.

SECTION 7.02 Proxies. Unless otherwise provided by resolution adopted by the Board of Directors, the Chief Executive Officer, the President or any Vice President may from time to time appoint an attorney or attorneys or agent or agents of the Corporation, in the name and on behalf of the Corporation, to cast the votes which the Corporation may be entitled to cast as the holders of stock or other securities in any other entity, any of whose stock or other securities may be held by the Corporation, at meetings of the holders of the stock or other securities of such other entity, or to consent in accordance with applicable law, in the name of the Corporation as such holder, to any action by such other entity, and may instruct the person or persons so appointed as to the manner of casting such votes or giving such consent, and may execute or cause to be executed in the name and on behalf of the Corporation and under its corporate seal or otherwise, all such proxies or other instruments as he may deem necessary or proper in the premises.

ARTICLE VIII
AMENDMENTS

SECTION 8.01 Amendments. The By-Laws may be altered or repealed and new By-Laws may be adopted (a) at any annual or special meeting of stockholders by the affirmative

vote of the holders of a majority of the voting power of the Voting Stock, voting as a single class; provided, however, that any proposed alteration or repeal of, or the adoption of any By-Law inconsistent with, Section 2.02,
Section 2.07, or Section 8.01 of these By-Laws by the stockholders shall require the affirmative vote of the holders of at least two-thirds of the voting power of all Voting Stock then outstanding, voting together as a single class, and provided, further, however, that, in the case of any such stockholder action at a special meeting of stockholders, notice of the proposed alteration, repeal or adoption of the new By-Law or By-Laws must be contained in the notice of such special meeting, or (b) by the affirmative vote of a majority of the Whole Board.

EXHIBIT 4.1

RIGHTS AGREEMENT

SCS TRANSPORTATION, INC.

and

MELLON INVESTOR SERVICES LLC

Rights Agent

Dated as of September 30, 2002

INDEX

                                                                                                              Page
                                                                                                              ----
Section 1.  Certain Definitions............................................................................     1
Section 2.  Appointment of Rights Agent....................................................................     5
Section 3.  Issue of Right Certificates....................................................................     5
Section 4.  Form of Right Certificates.....................................................................     7
Section 5.  Countersignature and Registration..............................................................     8
Section 6.  Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed,
               Lost or Stolen Right Certificates...........................................................     8
Section 7.  Exercise of Rights; Purchase Price; Expiration Date of Rights..................................     9
Section 8.  Cancellation and Destruction of Right Certificates.............................................    11
Section 9.  Reservation and Availability of Shares of Preferred Stock......................................    11
Section 10. Preferred Stock Record Date....................................................................    12
Section 11. Adjustment of Purchase Price, Number of Shares or Number of Rights.............................    12
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.....................................    19
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power...........................    19
Section 14. Fractional Rights and Fractional Shares........................................................    21
Section 15. Rights of Action...............................................................................    23
Section 16. Agreement of Right Holders.....................................................................    24
Section 17. Right Certificate Holder Not Deemed a Stockholder..............................................    24
Section 18. Concerning the Rights Agent....................................................................    24
Section 19. Merger or Consolidation or Change of Name of Rights Agent......................................    25
Section 20. Duties of Rights Agent.........................................................................    26
Section 21. Change of Rights Agent.........................................................................    28
Section 22. Issuance of New Right Certificates.............................................................    29

Section 23. Redemption and Termination.....................................................................    29
Section 24. Exchange.......................................................................................    30
Section 25. Notice of Proposed Actions.....................................................................    31
Section 26. Notices........................................................................................    32
Section 27. Supplements and Amendments.....................................................................    33
Section 28. Successors.....................................................................................    33
Section 29. Benefits of This Rights Agreement..............................................................    34
Section 30. Severability...................................................................................    34
Section 31. Governing Law..................................................................................    34
Section 32. Counterparts...................................................................................    34
Section 33. Descriptive Headings...........................................................................    34

Exhibit A   Form of Certificate of Designations for
              Series A Junior Participating
              Preferred Stock

Exhibit B   Form of Right Certificate

Exhibit C   Summary of Preferred Stock Purchase Rights

RIGHTS AGREEMENT

This Rights Agreement, dated as of September 30, 2002 is entered into between SCS TRANSPORTATION, INC., a Delaware corporation (the "Company") and MELLON INVESTOR SERVICES LLC, a New Jersey limited liability company (the "Rights Agent").

W I T N E S S E T H

WHEREAS, on September 17, 2002, the Board of Directors of the Company authorized and declared a dividend distribution of one right (hereinafter referred to as a "Right") for each share of Common Stock, par value $0.001 per share, of the Company outstanding at the close of business on September 30, 2002 (the "Record Date"), (other than shares of such Common Stock held in the Company's treasury on such date) and has authorized the issuance of one Right in respect of each share of Common Stock of the Company issued between the Record Date (whether originally issued or issued from the Company's treasury) and the Distribution Date (as such term is defined in Section 3 hereof), each Right representing the right to purchase one one-ten-thousandth of a share of Series A Junior Participating Preferred Stock of the Company having the rights, powers and preferences set forth in the form of Certificate of Designations attached hereto as Exhibit A, upon the terms and subject to the conditions hereinafter set forth (the "Rights"); and

WHEREAS, the Company desires to appoint the Rights Agent to act as provided herein, and the Rights Agent is willing to so act.

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereby agree as follows:

Section 1. Certain Definitions. For purposes of this Rights Agreement, the following terms have the meanings indicated:

(a) "Acquiring Person" shall mean any Person (as hereinafter defined) who or which, together with all Affiliates (as hereinafter defined) and Associates (as hereinafter defined) of such Person, without the Prior Written Approval of the Company (as hereinafter defined), shall be the Beneficial Owner (as hereinafter defined) of securities of the Company constituting 15% or more of the Voting Power (as hereinafter defined) of the Company or was such a Beneficial Owner at any time after the date hereof, whether or not such Person continues to be the Beneficial Owner of securities representing 15% or more of the Voting Power of the Company, but shall not include (i) the Company, any Subsidiary of the Company, any employee benefit plan or compensation arrangement of the Company or any Subsidiary of the Company, or any entity holding securities of the Company to the extent organized, appointed or established by the Company or any Subsidiary of the Company for or pursuant to the terms of any such employee benefit plan or compensation arrangement, or prior to the Spin-off Date, Yellow or (ii) any Person who or which, together with all Affiliates and Associates of such Person, inadvertently may become the Beneficial Owner of securities of the Company representing 15% or more of the Voting Power of the Company or otherwise becomes such a Beneficial Owner without a plan or intention to acquire control of the Company, so long as such Person,

individually or together with the Affiliates and Associates of such Person, promptly enters into, and delivers to the Company, an irrevocable commitment promptly to divest, and thereafter promptly divests (without exercising or retaining any power, including voting, with respect to such securities), sufficient securities of the Company so that such Person, together with all Affiliates and Associates of such Person, ceases to be the Beneficial Owner of 15% or more of the Voting Power of the Company. Notwithstanding the foregoing, no Person shall become an "Acquiring Person" as the result of an acquisition of voting securities of the Company by the Company which, by reducing the amount of such securities outstanding, increases the proportionate voting power of such securities beneficially owned by such Person to 15% or more of the Voting Power of the Company; provided, however, that if a Person becomes the Beneficial Owner of securities constituting 15% or more of the Voting Power of the Company by reason of purchases by the Company and shall, after such purchases by the Company, become the Beneficial Owner of any additional voting securities of the Company without the Prior Written Approval of the Company, then such Person shall be deemed to be an Acquiring Person.

(b) "Affiliate" and "Associate" shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in effect on the date hereof.

(i) which such Person or any of such Person's Affiliates or Associates beneficially owns, directly or indirectly as determined pursuant to Rule 13d-3 of the General Rules and Regulations under the Exchange Act, as in effect on the date hereof;

(ii) which such Person or any of such Person's Affiliates or Associates has (A) the right to acquire (whether such right is exercisable immediately or only after the passage of time) pursuant to any agreement, arrangement or understanding (other than customary agreements with and between underwriters and selling group members with respect to a bona fide public offering of securities), or upon the exercise of conversion rights, exchange rights, rights (other than these Rights), warrants or options, or otherwise, provided, however, that a Person shall not be deemed the "Beneficial Owner" of securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person's Affiliates or Associates until such tendered securities are accepted for payment or exchange; or (B) the right to vote pursuant to any agreement, arrangement or understanding, provided, however, that a Person shall not be deemed the "Beneficial Owner" of any security under this clause (B) if the agreement, arrangement or understanding to vote such security (1) arises solely from a revocable proxy or consent given in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable rules and regulations under the Exchange Act and (2) is not also then reportable by such person on Schedule 13D under the Exchange Act (or any comparable or successor report); or

(iii) which are beneficially owned, directly or indirectly, by any other Person with which such Person or any of such Person's Affiliates or Associates has any agreement, arrangement or understanding (other than customary agreements with and

between underwriters and selling group members with respect to a bona fide public offering of securities) for the purpose of acquiring, holding, voting (except pursuant to a revocable proxy or consent as described in clause (B) of subparagraph (ii) of this paragraph (c)) or disposing of any securities of the Company.

Notwithstanding anything in this definition of Beneficial Ownership to the contrary, the phrase "then outstanding," when used with reference to a Person's Beneficial Ownership of securities of the Company, shall mean the number of such securities then issued and outstanding together with the number of such securities not then actually issued and outstanding which such Person would be deemed to own beneficially hereunder.

(d) "Board of Directors" shall mean the Board of Directors of the Company as constituted from time to time.

(e) "Business Day" shall mean any day other than a Saturday, Sunday, or a day on which banking institutions in the State of Missouri or the State of New Jersey are authorized or obligated by law or executive order to close.

(f) "Close of Business" on any given date shall mean 5:00 P.M., New York time, on such date; provided, however, that if such date is not a Business Day it shall mean 5:00 P.M., New York time, on the next succeeding Business Day.

(g) "Common Stock" shall mean the Common Stock, par value $0.001 per share, of the Company, except that "Common Stock" when used with reference to any Person other than the Company shall mean the capital stock with the greatest Voting Power of such Person or the equity securities or other equity interest having power to control or direct the management of such Person or, if such Person is a Subsidiary (as hereinafter defined) of another Person, of the Person which ultimately controls such first mentioned Person and which has issued and outstanding such capital stock, equity securities or equity interests.

(h) "Company" shall have the meaning set forth in the Preamble of this Rights Agreement.

(i) "Distribution Date" shall have the meaning set forth in
Section 3 hereof.

(j) "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

(k) "Expiration Date" shall have the meaning set forth in Section 7(a) hereof.

(l) "Final Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.

(m) "Person" shall mean any individual, firm, corporation, partnership, limited liability company or other entity, and shall include any successor (by merger or otherwise) of any such entity.

(n) "Preferred Stock" shall mean the Series A Junior Participating Preferred Stock, par value $0.001 per share, of the Company.

(o) "Prior Written Approval of the Company" shall mean prior express written consent of the Company to the actions in question, executed on behalf of the Company by a duly authorized officer of the Company following express approval by action of at least a majority of the members of the Board of Directors then in office.

(p) "Purchase Price" shall have the meaning set forth in Section 4 hereof.

(q) "Record Date" shall have the meaning set forth in the Recitals of this Rights Agreement.

(r) "Redemption Price" shall have the meaning set forth in
Section 23(a) hereof.

(s) "Right" shall have the meaning set forth in the Preamble of this Rights Agreement.

(t) "Rights Agent" shall (i) have the meaning set forth in the Preamble of this Rights Agreement, (ii) mean any successor to or replacement of Mellon Investor Services LLC as provided in Sections 19 or 21 hereof, or (iii) mean any additional Person appointed pursuant to Section 2 hereof.

(u) "Rights Agreement" shall have the meaning set forth in the Preamble of this Rights Agreement.

(v) "Section 11(b) Event" shall have the meaning set forth in
Section 11(b) hereof.

(w) "Section 13 Event" shall mean an event described in clauses
(x), (y) or (z) of Section 13(a) hereof.

(x) "Securities Act" shall mean the Securities Act of 1933, as amended.

(y) "Spin-off Date" shall mean the time at which Yellow shall distribute all of the Common Stock of the Company it owns to its stockholders pursuant to the Master Separation and Distribution Agreement by and between the Company and Yellow, dated as of September 30, 2000, as amended, modified or supplemented from time to time.

(a) "Stock Acquisition Date" shall mean the earlier of (i) the first date of public announcement by the Company or a Person that an Acquiring Person has become an Acquiring Person, or (ii) the date on which the Company first has notice, direct or indirect, or otherwise determines that a Person has become an Acquiring Person.

(aa) "Subsidiary" shall mean, with respect to any Person, any other Person of which securities or other ownership interests having ordinary Voting Power, in the absence of contingencies, to elect a majority of the board of directors (or other persons performing similar

functions) of such other Person are at the time directly or indirectly owned by such Person or one or more of such Person's Subsidiaries, except that "Subsidiary" when used with reference to the Company shall mean any Person of which either a majority of the Voting Power of the voting equity securities or a majority of the equity interests is owned, directly or indirectly, by the Company.

(bb) "Voting Power" shall mean the voting power of all securities of a Person then outstanding generally entitled to vote for the election of directors of the Person (or, where appropriate, for the election of persons performing similar functions).

(cc) "Yellow" shall mean Yellow Corporation, a Delaware corporation.

Section 2. Appointment of Rights Agent. The Company hereby appoints the Rights Agent to act as agent for the Company in accordance with the terms and conditions hereof, and the Rights Agent hereby accepts such appointment. The Company may from time to time appoint such Co-Rights Agents as it may deem necessary or desirable upon ten (10) days' prior written notice to the Rights Agent. The Rights Agent shall have no duty to supervise, and in no event shall be liable for, the acts or omissions of any such Co-Rights Agent.

Section 3. Issue of Right Certificates.

(a) Until the earlier of (i) the Close of Business on the tenth Business Day after the Stock Acquisition Date or (ii) the Close of Business on the tenth Business Day (or such later date as may be determined by action of the Board of Directors but in no event later than the tenth Business Day after such time as any Person becomes an Acquiring Person) after the date that a tender or exchange offer by any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan or compensation arrangement of the Company or of any Subsidiary of the Company, or any entity holding securities of the Company to the extent organized, appointed or established by the Company or any Subsidiary of the Company for or pursuant to the terms of any such employee benefit plan or compensation arrangement) is first published or sent or given within the meaning of Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act, without the Prior Written Approval of the Company, which tender or exchange offer would result in any Person becoming the Beneficial Owner of Voting Power aggregating 15% or more of the outstanding Voting Power (including any such date which is after the date of this Rights Agreement and prior to the issuance of the Rights; the earlier of such dates being herein referred to as the "Distribution Date"), (y) the Rights will be evidenced (subject to the provisions of paragraph (b) of this Section 3) by the certificates for the Common Stock registered in the names of the holders of the Common Stock (which certificates for Common Stock shall be deemed also to be Right Certificates) and not by separate Right Certificates, as more fully set forth below, and (z) the Rights (and the right to receive certificates therefor) will be transferable only in connection with the transfer of the underlying shares of Common Stock, as more fully set forth below. As soon as practicable after the Company has (i) notified the Rights Agent in writing of the occurrence of the Distribution Date, (ii) provided the Rights Agent with specific written instruction, and (iii) provided the Rights Agent with all other relevant information which the Rights Agent may request, the Company shall prepare and execute, and the Rights Agent shall countersign and send, by first class, insured, postage prepaid mail, to each record holder of the Common Stock as of the Close of Business on the Distribution

Date, at the address of such holder shown on the records of the Company, a right certificate, in substantially the form of Exhibit B hereto (the "Right Certificate"), evidencing one Right for each share of Common Stock so held, subject to adjustment as provided herein. As of and after the Distribution Date, the Rights will be evidenced solely by such Right Certificates. Until the Rights Agent receives written notice of the Distribution Date from the Company, the Rights Agent may presume conclusively for all purposes that the Distribution Date has not occurred.

(b) On the Record Date or as soon as practicable thereafter, the Company will send a copy of a Summary of Rights to Purchase Preferred Stock, in substantially the form of Exhibit C hereto (the "Summary of Rights"), by first-class, postage prepaid mail, to each record holder of the Common Stock as of the Close of Business on the Record Date, at the address of such holder shown on the records of the Company. With respect to certificates for the Common Stock outstanding as of the Record Date, until the Distribution Date (or the earlier redemption, expiration or termination of the Rights), the Rights will be evidenced by such certificates for the Common Stock registered in the names of the holders of the Common Stock and the registered holders of the Common Stock shall also be registered holders of the associated Rights. Until the Distribution Date (or the earlier redemption, expiration or termination of the Rights), the surrender for transfer of any of the certificates for the Common Stock outstanding in respect of which Rights have been issued shall also constitute the transfer of the Rights associated with the Common Stock represented by such certificate.

(c) Certificates for the Common Stock issued after the Record Date but prior to the earlier of the Distribution Date or the redemption, expiration or termination of the Rights shall be deemed also to be certificates for Rights and shall have impressed, printed or written on, or otherwise affixed to them a legend substantially to the following effect:

This certificate also evidences and entitles the holder hereof to certain Rights as set forth in a Rights Agreement between SCS Transportation, Inc. (the "Company") and Mellon Investor Services LLC (or any successor thereto), as Rights Agent, as it may from time to time be supplemented or amended (the "Rights Agreement"), the terms of which are incorporated herein by reference and a copy of which is on file at the principal executive offices of the Company. Under certain circumstances, as set forth in the Rights Agreement, such Rights may expire or may be redeemed, exchanged or be evidenced by separate certificates and no longer be evidenced by this certificate. The Company will mail to the holder of this certificate a copy of the Rights Agreement without charge promptly after receipt of a written request therefor. Under certain circumstances, Rights issued to or held by Acquiring Persons or their Affiliates or Associates (as defined in the Rights Agreement) and any subsequent holder of such Rights may become null and void.

With respect to such certificates containing the foregoing legend, until the Distribution Date (or the earlier redemption, expiration or termination of the Rights), the Rights associated with the Common Stock represented by such certificates shall be evidenced by such certificates alone, and the surrender for transfer of any of such certificates shall also constitute the transfer of the Rights associated with the Common Stock represented by such certificates.

In the event that the Company purchases or acquires any Common Stock after the Record Date but prior to the Distribution Date, any Rights associated with such Common Stock shall be deemed canceled and retired so that the Company shall not be entitled to exercise any Rights associated with shares of Common Stock which are no longer outstanding.

Section 4. Form of Right Certificates.

(a) The Right Certificates (and the forms of election to purchase shares and of assignment to be printed on the reverse thereof) shall be in substantially the same form as Exhibit B hereto and may have such marks of identification or designation and such legends, summaries or endorsements printed thereon as the Company may deem appropriate (but which do not affect the rights, duties or obligations of the Rights Agent as set forth in this Agreement) and as are not inconsistent with the provisions of this Rights Agreement, or as may be required to comply with any applicable law, rule or regulation or with any rule or regulation of any stock exchange on which the Rights may from time to time be listed, or to conform to customary usage. Subject to the provisions of Section 11 and Section 22 hereof, the Right Certificates, whenever issued, shall be dated as of the Record Date, and on their face shall entitle the holders thereof to purchase such number of one ten-thousandths of a share of Preferred Stock as shall be set forth therein at the price per one ten-thousandth of a share as set forth therein (the "Purchase Price"), but the number and identity of such shares and the Purchase Price shall be and remain subject to adjustment as provided in Sections 11, 13 and 22 hereof.

(b) Any Right Certificate issued pursuant hereto that represents Rights beneficially owned by (i) an Acquiring Person or any Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) which becomes a transferee after the Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) which becomes a transferee prior to or concurrently with the Acquiring Person becoming such and which receives such Rights pursuant to either (A) a transfer (whether or not for consideration) from the Acquiring Person (or any such Associate or Affiliate) to holders of equity interests in such Acquiring Person (or such Associate or Affiliate) or to any Person with whom such Acquiring Person (or such Associate or Affiliate) has any continuing plan, agreement, arrangement or understanding regarding either the transferred Rights, shares of Company Common Stock or the Company or (B) a transfer which a majority of the Board of Directors has determined to be part of a plan, agreement, arrangement or understanding which has as a primary purpose or effect the avoidance of Section 7(e), and any Right Certificate issued pursuant to Section 6 hereof, Section 11 hereof or Section 22 hereof upon transfer, exchange, replacement or adjustment of any other Right Certificate referred to in this sentence, shall contain (to the extent the Rights Agent has notice thereof and to the extent feasible) the following legend:

The Rights represented by this Right Certificate are or were beneficially owned by a Person who was or became an Acquiring Person or an Affiliate or an Associate of an Acquiring Person. Accordingly, this Right Certificate and the Rights represented hereby are void in the circumstances specified in Section 7(e) of the Rights Agreement.

The failure to print the foregoing legend on any such Right Certificate or any defect therein shall not affect in any manner whatsoever the application or interpretation of the provisions of Section 7(e) hereof.

Section 5. Countersignature and Registration.

(a) The Right Certificates shall be executed on behalf of the Company by its Chairman, President and Chief Executive Officer, Chief Financial Officer or any Vice President, either manually or by facsimile signature, and shall have affixed thereto the Company's seal or a facsimile thereof which shall be attested by the Secretary or any Assistant Secretary of the Company, either manually or by facsimile signature. The Right Certificates shall be countersigned manually or by facsimile signature by the Rights Agent or the registrar or co-registrar for the Common Stock (the "Registrar") and shall not be valid for any purpose unless so countersigned. In case any officer of the Company whose manual or facsimile signature is affixed to the Right Certificates shall cease to be such officer of the Company before countersignature by the Rights Agent or the Registrar and issuance and delivery by the Company, such Right Certificates, nevertheless, may be countersigned by the Rights Agent or the Registrar, issued and delivered with the same force and effect as though the person who signed such Right Certificates had not ceased to be such officer of the Company. Any Right Certificate may be signed on behalf of the Company by any person who, at the actual date of the execution of such Right Certificate, shall be a proper officer of the Company to sign such Right Certificate, although at the date of the execution of this Rights Agreement any such person was not such an officer.

(b) Following the Distribution Date and receipt by the Rights Agent of (i) written notice of the Distribution Date pursuant to Section 3(a) hereof, and (ii) all necessary information reasonably requested by the Rights Agent pursuant to Section 3(a) hereof, the Rights Agent will keep or cause to be kept, at its stockholder services office or such other office designated for such purpose, books for registration and transfer of the Right Certificates issued hereunder. Such books shall show the names and addresses of the respective holders of the Right Certificates, the number of Rights evidenced on its face by each of the Right Certificates, the certificate number of each of the Right Certificates and the date of each of the Right Certificates.

Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.

(a) Subject to the provisions of Section 14 hereof, at any time after the Close of Business on the Distribution Date, and at or prior to the Close of Business on the Expiration Date (as such term is defined in Section 7(a) hereof), any Right Certificate or Right Certificates may be transferred, split up, combined or exchanged for another Right Certificate or Right Certificates, entitling the registered holder to purchase a like number of shares of Preferred Stock as the Right Certificate or Right Certificates surrendered then entitled such holder to purchase. Any registered holder desiring to transfer, split up, combine or exchange any Right Certificate shall make such request in writing delivered to the Rights Agent, and shall surrender the Right Certificate or Right Certificates to be transferred, split up, combined or exchanged at the office of the Rights Agent designated for such purpose. Neither the Rights Agent nor the Company

shall be obligated to take any action whatsoever with respect to the transfer of any such surrendered Rights Certificate until the registered holder shall have properly completed and signed the certificate contained in the form of assignment on the reverse side of such Rights Certificate and shall have provided such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall reasonably request. Thereupon, the Rights Agent shall countersign and deliver to the person entitled thereto a Right Certificate or Right Certificates, as the case may be, as so requested. The Company may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer, split up, combination or exchange of Right Certificates. The Rights Agent shall have no duty or obligation to take any action under any Section of this Agreement which requires the payment by a Rights holder of applicable taxes and/or governmental charges unless and until it is satisfied that all such taxes or applicable governmental charges have been paid.

(b) Upon receipt by the Company and the Rights Agent of evidence reasonably satisfactory to them of the loss, theft, destruction or mutilation of a Right Certificate, and, in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to them, and reimbursement to the Company and the Rights Agent of all reasonable expenses incidental thereto, and upon surrender to the Rights Agent and cancellation of the Right Certificate if mutilated, the Company will make and deliver a new Right Certificate of like tenor to the Rights Agent for countersignature and delivery to the registered owner in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.

Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.

(a) The registered holder of any Right Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein) in whole or in part at any time after the Distribution Date upon surrender of the Right Certificate, with the form of election to purchase on the reverse side thereof duly executed, to the Rights Agent at the stockholder services office of the Rights Agent or such office designated for such purpose, together with payment of the Purchase Price for each one ten-thousandth of a share of Preferred Stock as to which the Rights are exercised, at or prior to the Close of Business on the Expiration Date. The "Expiration Date", as used in this Rights Agreement, shall be the earliest of (i) the Final Expiration Date (as defined below), (ii) the time at which the Rights are redeemed as provided in Section 23 hereof, or
(iii) the time at which the Rights are exchanged as provided in Section 24 hereof. The "Final Expiration Date", as used in this Rights Agreement, shall be September 30, 2012.

(b) The Purchase Price for each one ten-thousandth of a share of Preferred Stock pursuant to the exercise of a Right shall initially be $96.00, shall be subject to adjustment from time to time as provided in Sections 11 and 13 hereof and shall be payable in lawful money of the United States of America in accordance with paragraph (c) below.

(c) Upon receipt of a Right Certificate, with the form of election to purchase duly executed, accompanied by payment of the Purchase Price for each one-ten-thousandth of a share of Preferred Stock to be purchased and an amount equal to any applicable tax or charge required to be paid by the holder of the Rights pursuant hereto in accordance with Section 9 hereof by certified check, bank draft or money order payable to the order of the Company or the

Rights Agent, the Rights Agent shall, subject to Section 20(k) hereof, thereupon promptly (i) either (A) requisition from any transfer agent of the shares of Preferred Stock (or make available, if the Rights Agent is the transfer agent) certificates for the number of shares of Preferred Stock to be purchased and the Company hereby irrevocably authorizes any such transfer agent to comply with all such requests, or (B) if the Company, in its sole discretion, shall have elected to deposit the shares of Preferred Stock issuable upon exercise of the Rights hereunder into a depositary, requisition from the depositary agent depositary receipts representing such number of one ten-thousandths of a share of Preferred Stock as are to be purchased (in which case certificates for the shares of Preferred Stock represented by such receipts shall be deposited by the transfer agent with the depositary agent) and the Company hereby directs such depositary agent to comply with all such requests, (ii) promptly after receipt of such certificates or depositary receipts cause the same to be delivered to or upon the order of the registered holder of such Right Certificate, registered in such name or names as may be designated by such holder, (iii) when appropriate, requisition from the Company the amount of cash to be paid in lieu of issuance of fractional shares in accordance with Section 14 hereof, (iv) after receipt of any such cash, promptly deliver such cash to or upon the order of the registered holder of such Right Certificate, (v) when appropriate, requisition from the Company the amount of cash or securities issuable upon exercise of a Right pursuant to the adjustment provisions of Section 11 or the exchange provisions of Section 24, and (vi) after receipt of any such cash or securities, promptly deliver such cash or securities to or upon the order of the registered holder of such Right Certificate, of any such cash or securities.

(d) In case the registered holder of any Right Certificate shall exercise less than all the Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent to the Rights remaining unexercised shall be issued by the Rights Agent to the registered holder of such Right Certificate or to such holder's duly authorized assigns, subject to the provisions of Section 14 hereof.

(e) Notwithstanding anything in this Rights Agreement to the contrary, upon the first occurrence of a Section 11(b) Event or a Section 13 Event, any Rights beneficially owned by (i) an Acquiring Person or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) which becomes a transferee after the Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or of any such Associate or Affiliate) which becomes a transferee prior to or concurrently with the Acquiring Person becoming such and which receives such Rights pursuant to either (A) a transfer (whether or not for consideration) from the Acquiring Person (or any such Associate or Affiliate) to holders of equity interests in such Acquiring Person (or any such Associate or Affiliate) or to any Person with whom such Acquiring Person (or such Associate or Affiliate) has any continuing plan, agreement, arrangement or understanding regarding the transferred Rights, shares of Company Common Stock or the Company or (B) a transfer which a majority of the Board of Directors has determined to be part of a plan, agreement, arrangement or understanding which has as a primary purpose or effect the avoidance of this Section 7(e), shall be null and void without any further action, and no holder of such Rights shall have any rights whatsoever with respect to such Rights, whether under any provision of this Agreement or otherwise. The Company shall use all reasonable efforts to notify the Rights Agent when this Section 7(e) applies and to ensure that the provisions of this
Section 7(e) and Section 4(b) are complied with, but neither the Company nor the Rights Agent shall have any liability to any holder of Rights or

any other Person as a result of its failure to make any determination under this
Section 7(e) or Section 4(b) with respect to an Acquiring Person or its Affiliates, Associates or transferees hereunder.

(f) Notwithstanding anything in this Rights Agreement to the contrary, neither the Rights Agent nor the Company shall be obligated to undertake any action with respect to a registered holder upon the occurrence of any purported exercise as set forth in this Section 7 unless the certificate contained in the appropriate form of election to purchase set forth on the reverse side of the Right Certificate surrendered for such exercise shall have been properly completed and duly executed by the registered holder thereof and the Company or the Rights Agent shall have been provided with such additional evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates thereof as the Company or the Rights Agent shall reasonably request.

Section 8. Cancellation and Destruction of Right Certificates. All Right Certificates surrendered for the purpose of exercise, transfer, split up, combination or exchange shall, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in canceled form, or, if surrendered to the Rights Agent, shall be canceled by it, and no Right Certificates shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Rights Agreement. The Company shall deliver to the Rights Agent for cancellation and retirement, and the Rights Agent shall so cancel and retire, any other Right Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. The Rights Agent shall deliver all canceled Right Certificates to the Company, or shall, at the written request of the Company, destroy such canceled Right Certificates, and in such case shall deliver a certificate of destruction thereof to the Company.

Section 9. Reservation and Availability of Shares of Preferred Stock.

(a) The Company covenants and agrees that it will cause to be reserved and kept available out of its authorized and unissued shares of Preferred Stock or its authorized and issued shares of Preferred Stock held in its treasury, the number of shares of Preferred Stock that will be sufficient to permit the exercise in full of all outstanding Rights and, after the occurrence of a Section 11(b) Event or a Section 13 Event, shall so reserve and keep available a sufficient number of shares of Preferred Stock, Common Stock and/or other securities which may be required to permit the exercise in full of the Rights pursuant to this Rights Agreement.

(b) The Company covenants and agrees that it will take all such action as may be necessary to ensure that all shares of Preferred Stock and/or other securities delivered upon exercise of Rights shall, at the time of delivery of the certificates for such shares or other securities (subject to payment of the Purchase Price), be duly and validly authorized and issued and fully paid and nonassessable shares or securities.

(c) The Company shall use its best efforts to (i) file, as soon as practicable following the first occurrence of an event which would establish the Distribution Date, a registration statement under the Securities Act, with respect to the securities purchasable upon exercise of the Rights on an appropriate form, (ii) cause such registration statement to become effective as soon as practicable after such filing, and (iii) cause such registration statement to

remain effective (with a prospectus at all times meeting the requirements of the Securities Act) until the Expiration Date. The Company will also take such action as may be appropriate under the "blue sky laws" of the various states.

(d) The Company further covenants and agrees that it will pay when due and payable any and all federal and state taxes and governmental charges which may be payable in respect of the issuance or delivery of the Right Certificates or of any shares of Preferred Stock and/or other securities upon the exercise of Rights. The Company shall not, however, be required to pay any tax or charge which may be payable in respect of any transfer involved in the transfer or delivery of Right Certificates or the issuance or delivery of certificates or depositary receipts for Preferred Stock and/or other securities in a name other than that of the registered holder of the Right Certificate evidencing Rights surrendered for exercise, nor shall the Company be required to issue or deliver any certificates or depositary receipts for shares of Preferred Stock and/or other securities upon the exercise of any Rights until any such tax or charge shall have been paid (any such tax or charge being payable by the holder of such Right Certificate at the time of surrender) or until it has been established to the Company's satisfaction that no such tax or charge is due.

10. Preferred Stock Record Date. Each person (other than the Company) in whose name any certificate for shares of Preferred Stock (or other securities) is issued upon the exercise of Rights shall for all purposes be deemed to have become the holder of record of the Preferred Stock (or other securities) represented thereby on, and such certificate shall be dated, the date upon which the Right Certificate evidencing such Rights was duly surrendered and payment of the Purchase Price (and any applicable taxes or charges) was made; provided, however, that if the date of such surrender and payment is a date upon which the Preferred Stock (or other securities) transfer books of the Company are closed, such person shall be deemed to have become the record holder of such shares on, and such certificate shall be dated, the next succeeding Business Day on which the Preferred Stock (or other securities) transfer books of the Company are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Right Certificate shall not be entitled to any rights of a stockholder of the Company with respect to shares for which the Rights shall be exercisable, including, without limitation, the right to vote, to receive dividends or other distributions or to exercise any preemptive rights, and shall not be entitled to receive any notice of any proceedings of the Company, except as provided herein.

Section 11. Adjustment of Purchase Price, Number of Shares or Number of Rights. The Purchase Price, the number and identity of shares covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11.

(a) In the event the Company shall at any time after the date of this Rights Agreement (i) declare a dividend on the Preferred Stock payable in shares of Preferred Stock, (ii) subdivide the outstanding Preferred Stock, (iii) combine the outstanding Preferred Stock into a smaller number of shares or (iv) issue any shares of its capital stock in a reclassification of the Preferred Stock (including any such reclassification in connection with a consolidation or merger in which the Company is the continuing or surviving corporation), except as otherwise provided in this Section 11, the Purchase Price in effect at the time of the record date for such dividend or

the time of the effective date of such subdivision, combination or reclassification, and the number and kind of shares of capital stock, including Preferred Stock, issuable upon exercise of a Right, shall be proportionately adjusted so that the holder of any Right exercised after such time, upon payment of the aggregate consideration such holder would have had to pay to exercise such Right prior to such time, shall be entitled to receive the aggregate number and kind of shares of capital stock, including Preferred Stock, which, if such Right had been exercised immediately prior to such date and at a time when the Preferred Stock transfer books of the Company were open, such holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, combination or reclassification.

(b) In the event any Person becomes an Acquiring Person ("Section
11(b) Event"), then proper provision shall be made so that each holder of a Right, subject to Section 7(e) and Section 24 hereof and except as provided below, shall after the later of the occurrence of such event and the effective date of an appropriate registration statement pursuant to Section 9 hereof, have a right to receive, upon exercise thereof at the then current Purchase Price, multiplied by the then number of one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable, in accordance with the terms of this Rights Agreement, in lieu of shares of Preferred Stock, such number of shares of Common Stock of the Company as shall equal the result obtained by (y) multiplying the then current Purchase Price by the then number of one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable and dividing that product by (z) 50% of the current market price per one share of Common Stock (determined pursuant to Section 11(f) hereof on the date of the occurrence of the Section 11(b) Event) (such number of shares being referred to as the "number of Adjustment Shares").

(c) In the event that there shall not be sufficient Treasury shares or authorized but unissued shares of Common Stock to permit the exercise in full of the Rights in accordance with the foregoing Section 11(b), and the Rights become so exercisable, notwithstanding any other provision of this Rights Agreement, to the extent necessary and permitted by applicable law and any agreements in effect on the date hereof to which the Company is a party, each Right shall thereafter represent the right to receive, upon exercise thereof at the then current Purchase Price, multiplied by the then number of one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable, in accordance with the terms of this Rights Agreement, a number of shares, or units of shares, of (y) Common Stock, and (z) preferred stock (or other equity securities) of the Company, including, but not limited to Preferred Stock, equal in the aggregate to the number of Adjustment Shares where the Board of Directors shall have in good faith deemed such shares or units, other than the shares of Common Stock, to have at least the same value and voting rights as the Common Stock (a "common stock equivalent"); provided, however, if there are unavailable sufficient shares (or fractions of shares) of Common Stock and/or common stock equivalents, then the Company shall take all such action as may be necessary to authorize additional shares of Common Stock or common stock equivalents for issuance upon exercise of the Rights, including the calling of a meeting of stockholders; and provided, further, that if the Company is unable to cause sufficient shares of Common Stock and/or common stock equivalents to be available for issuance upon exercise in full of the Rights, then the Company, to the extent necessary and permitted by applicable law and any agreements or instruments in effect on the date thereof to which it is a party, shall make provision to pay an amount in cash equal to twice the Purchase Price (as adjusted pursuant to this Section 11), in lieu of issuing shares of Common Stock and/or common stock equivalents. To the extent that the

Company determines that some action needs to be taken pursuant to this Section
11(c), the Board of Directors by action of at least a majority of its members then in office may suspend the exercisability of the Rights for a period of up to sixty (60) days following the date on which the Section 11(b) Event shall have occurred, in order to decide the appropriate form of distribution to be made pursuant to this Section 11(c) and to determine the value thereof. In the event of any such suspension, the Company shall issue a public announcement stating that the exercisability of the Rights has been temporarily suspended (with prompt written notice thereof to the Rights Agent). The Board of Directors may, but shall not be required to, establish procedures to allocate the right to receive Common Stock and common stock equivalents upon exercise of the Rights among holders of Rights, which such allocation may be, but is not required to be, pro rata.

(d) If the Company shall fix a record date for the issuance of rights or warrants to all holders of Preferred Stock entitling them (for a period expiring within 90 calendar days after such record date) to subscribe for or purchase Preferred Stock (or securities having the same or more favorable rights, privileges and preferences as the Preferred Stock ("equivalent preferred stock")) or securities convertible into Preferred Stock or equivalent preferred stock, at a price per share of Preferred Stock or per share of equivalent preferred stock or having a conversion or exercise price per share, as the case may be, less than the current market price per share of Preferred Stock (as defined in Section 11(f) hereof) on such record date, the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such date by a fraction, the numerator of which shall be the number of shares of Preferred Stock outstanding on such record date plus the number of shares of Preferred Stock which the aggregate offering price of the total number of shares of Preferred Stock or equivalent preferred stock to be offered (and/or the aggregate initial conversion price of the convertible securities so to be offered) would purchase at such current market price, and the denominator of which shall be the number of shares of Preferred Stock outstanding on such record date plus the number of additional shares of Preferred Stock and/or equivalent preferred stock to be offered for subscription or purchase (or into which the convertible securities so to be offered are initially convertible). In case such subscription price may be paid in a consideration, part or all of which shall be in a form other than cash, the value of such consideration shall be as determined in good faith by a majority of the Board of Directors, whose determination shall be described in a statement filed with the Rights Agent. Shares of Preferred Stock owned by or held for the account of the Company shall not be deemed outstanding for the purpose of any such computation. Such adjustment shall be made successively whenever such a record date is fixed; and in the event that such rights or warrants are not so issued, the Purchase Price shall be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed.

(e) If the Company shall fix a record date for the making of a distribution to all holders of Preferred Stock (including any such distribution made in connection with a consolidation or merger in which the Company is the continuing or surviving corporation) of evidences of indebtedness, cash (other than a regular periodic cash dividend out of earnings or retained earnings of the Company), assets (other than a dividend payable in Preferred Stock, but including any dividend payable in stock other than Preferred Stock) or convertible securities, subscription rights or warrants (excluding those referred to in Section 11(d) hereof), the Purchase Price to be in effect after such record date shall be determined by multiplying the Purchase Price in effect immediately prior to such record date by a fraction, the numerator of which shall be the

current market price for one share of Preferred Stock (as defined in Section 11(f) hereof) on such record date less the fair market value (as determined in good faith by a majority of the Board of Directors, whose determination shall be described in a statement filed with the Rights Agent) of the portion of the assets or evidences of indebtedness so to be distributed or of such convertible securities, subscription rights or warrants applicable to one share of Preferred Stock, and the denominator of which shall be such current market price for one share of Preferred Stock. Such adjustments shall be made successively whenever such a record date is fixed; and in the event that such distribution is not so made, the Purchase Price shall again be adjusted to be the Purchase Price which would then be in effect if such record date had not been fixed.

(i) For the purpose of any computation hereunder, the "current market price" of any security (a "Security" for purposes of this Section 11(f)(i)) on any date shall be deemed to be the average of the daily closing prices per share of such Security for the 30 consecutive Trading Days (as hereinafter defined) immediately prior to but not including such date; provided, however, that in the event that the current market price per share of such Security is determined during a period following the announcement by the issuer of such Security of (A) a dividend or distribution on such Security payable in shares of such Security or securities convertible into shares of such Security or (B) any subdivision, combination or reclassification of such Security, and prior to the expiration of 30 Trading Days after the ex-dividend date for such dividend or distribution or the record date for such subdivision, combination or reclassification, then, and in each such case, the "current market price" shall be appropriately adjusted to reflect the current market price per share equivalent of such Security. The closing price for each day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange or, if the Security is not listed or admitted to trading on the New York Stock Exchange, as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the principal national securities exchange on which the Security is listed or admitted to trading or, if the Security is not listed or admitted to trading on any national securities exchange, as reported by the National Association of Securities Dealers, Inc. Automated Quotation System ("Nasdaq") National Market, or if the Security is not listed or admitted to trading on any national securities exchange or included in the Nasdaq National Market, the average of the high bid and low asked prices in the over-the-counter market, as reported by Nasdaq or such other system then in use, or, if on any such date the Security is not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Security selected by a majority of the Board of Directors. If on any such date no market maker is making a market in the Security, the fair value of such Security on such date as determined in good faith by a majority of the Board of Directors shall be used. The term "Trading Day" shall mean a day on which the principal national securities exchange on which the Security is listed or admitted to trading is open for the transaction of business or, if the Security is not listed or admitted to trading on any national securities exchange a day on which the Nasdaq National Market is open for the transaction of business or, if the Security is not listed or admitted to trading on any national securities exchange or included in the Nasdaq National Market, a Business Day. If the Security is not publicly

held or not so listed or traded, "current market price" shall mean the fair value as determined in good faith by a majority of the Board of Directors, whose determination shall be described in a statement filed with the Rights Agent.

(ii) For the purpose of any computation hereunder, the "current market price" per share (or one ten-thousandth of a share) of Preferred Stock shall be determined in the same manner as set forth above for the Common Stock in clause (i) of this Section 11(f) (other than the last sentence thereof). If the current market price per share (or one ten-thousandth of a share) of Preferred Stock cannot be determined in the manner provided above or if the Preferred Stock is not publicly held or listed or traded in a manner described in clause (i) of this Section 11(f), the "current market price" per share of Preferred Stock shall be conclusively deemed to be an amount equal to 1,000 (as such number may be appropriately adjusted for such events as stock splits, stock dividends and recapitalizations with respect to the Common Stock occurring after the date of this Rights Agreement) multiplied by the current market price per share of the Common Stock and the "current market price" per one ten-thousandth of a share of Preferred Stock shall be equal to the current market price per share of the Common Stock (as appropriately adjusted). If neither the Common Stock nor the Preferred Stock is publicly held or so listed or traded, "current market price" per share shall mean the fair value per share as determined in good faith by the Board of Directors, whose determination shall be described in a statement filed with the Rights Agent and shall be conclusive for all purposes.

(f) No adjustment in the Purchase Price shall be required unless such adjustment would require an increase or decrease of at least 1% in the Purchase Price; provided, however, that any adjustments which by reason of this
Section 11(g) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 11 shall be made to the nearest cent or to the nearest ten-thousandth of a share, as the case may be. Notwithstanding the first sentence of this Section
11(g), any adjustment required by this Section 11 shall be made no later than the earlier of (i) three years from the date of the transaction which mandates such adjustment or (ii) the Expiration Date.

(g) In the event that at any time, as a result of an adjustment made pursuant to Section 11(a) or (b) hereof, the holder of any Right shall be entitled to receive upon exercise of such Right any shares of capital stock of the Company other than shares of Preferred Stock, thereafter the number of such other shares so receivable upon exercise of any Right shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the shares contained in Section 11(a) through (e) hereof, inclusive, and the provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the shares of Preferred Stock shall apply on like terms to any such other shares.

(h) All Rights originally issued by the Company subsequent to any adjustment made to the Purchase Price hereunder shall evidence the right to purchase, at the adjusted Purchase Price, the number of one-ten-thousandths of a share of Preferred Stock or other capital stock of the Company purchasable from time to time hereunder upon exercise of the Rights, all subject to further adjustment of the Purchase Price.

(i) Unless the Company shall have exercised its election as provided in Section 11(k) hereof, upon each adjustment of the Purchase Price as a result of the calculations made in Section 11(d) and (e) hereof, each Right outstanding immediately prior to the making of such adjustment shall thereafter evidence the right to purchase, at the adjusted Purchase Price, that number of one ten-thousandths of a share of Preferred Stock (calculated to the nearest one-ten-thousandth) obtained by (i) multiplying (A) the number of one-ten-thousandths of a share of Preferred Stock covered by a Right immediately prior to the adjustment by (B) the Purchase Price in effect immediately prior to such adjustment of the Purchase Price and (ii) dividing the product so obtained by the Purchase Price in effect immediately after such adjustment of the Purchase Price.

(j) The Company may elect on or after the date of any adjustment of the Purchase Price to adjust the number of Rights, in substitution for any adjustment in the number of shares of Preferred Stock purchasable upon the exercise of a Right. Each of the Rights outstanding after such adjustment of the number of Rights shall be exercisable for the number of one-ten-thousandths of a share of Preferred Stock for which such Right was exercisable immediately prior to such adjustment. Each Right held of record prior to such adjustment of the number of Rights shall become that number of Rights (calculated to the nearest one-ten-thousandth) obtained by dividing the Purchase Price in effect immediately prior to adjustment of the Purchase Price by the Purchase Price in effect immediately after adjustment of the Purchase Price. The Company shall make a public announcement of its election to adjust the number of Rights (with prompt written notice thereof to the Rights Agent), indicating the record date for the adjustment, and, if known at the time, the amount of the adjustment to be made. This record date may be the date on which the Purchase Price is adjusted or any day thereafter, but, if the Right Certificates have been issued, shall be at least 10 days later than the date of the public announcement. If Right Certificates have been issued, upon each adjustment of the number of Rights pursuant to this Section 11(k), the Company shall, as promptly as practicable, cause to be distributed to holders of record of Right Certificates on such record date Right Certificates evidencing, subject to Section 14 hereof, the additional Rights to which such holders shall be entitled as a result of such adjustment, or, at the option of the Company, shall cause to be distributed to such holders of record in substitution and replacement for the Right Certificates held by such holders prior to the date of adjustment, and upon surrender thereof, if required by the Company, new Right Certificates evidencing all the Rights to which such holders shall be entitled after such adjustment. Right Certificates so to be distributed shall be issued, executed and countersigned in the manner provided for herein (and may bear, at the option of the Company, the adjusted Purchase Price) and shall be registered in the names of the holders of record of Right Certificates on the record date specified in the public announcement.

(k) Irrespective of any adjustment or change in the Purchase Price or the number of shares of Preferred Stock issuable upon the exercise of the Rights, the Right Certificates theretofore and thereafter issued may continue to express the Purchase Price and the number of shares which were expressed in the initial Right Certificates issued hereunder.

(l) Before taking any action that would cause an adjustment reducing the Purchase Price below the then par value, if any, of the shares of Common Stock or other securities and below one ten-thousandth of the then par value, if any, of the Preferred Stock, issuable upon exercise of the Rights, the Company shall take any corporate action which may, in

the opinion of its counsel, be necessary in order that the Company may validly and legally issue fully paid and nonassessable shares of such Preferred Stock, Common Stock or other securities at such adjusted Purchase Price. If upon any exercise of the Rights, a holder is to receive a combination of Common Stock and common stock equivalents, a portion of the consideration paid upon such exercise, equal to at least the then par value of a share of Common Stock of the Company, shall be allocated as the payment for each share of Common Stock of the Company so received.

(m) In any case in which this Section 11 shall require that an adjustment in the Purchase Price be made effective as of a record date for a specified event, the Company may elect to defer until the occurrence of such event the issuing to the holder of any Right exercised after such record date the shares of Preferred Stock and other capital stock or securities of the Company, if any, issuable upon such exercise over and above the shares of Preferred Stock and other capital stock or securities of the Company, if any, issuable upon such exercise on the basis of the Purchase Price in effect prior to such adjustment; provided, however, that the Company shall deliver to such holder a due bill or other appropriate instrument evidencing such holder's right to receive such additional shares upon the occurrence of the event requiring such adjustment.

(n) Anything in this Section 11 to the contrary notwithstanding, the Company shall be entitled to make such reductions in the Purchase Price, in addition to those adjustments expressly required by this Section 11, as and to the extent that in their good faith judgment a majority of the Board of Directors shall determine to be advisable in order that any (i) consolidation or subdivision of the Preferred Stock, (ii) issuance wholly for cash of any Preferred Stock at less than the then current market price, (iii) issuance wholly for cash of Preferred Stock or securities which by their terms are convertible into or exchangeable for Preferred Stock, (iv) stock dividends or
(v) issuance of rights, options or warrants referred to hereinabove in this
Section 11, hereafter made by the Company to the holders of its Preferred Stock, shall not be taxable to such stockholders.

(o) In the event that at any time after the date of this Rights Agreement and prior to the Distribution Date, the Company shall (i) declare or pay any dividend on the Common Stock payable in shares of Common Stock or (ii) effect a subdivision, combination or consolidation of the Common Stock (by reclassification or otherwise than by payment of dividends in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in any such case (y) the number of one-ten-thousandths of a share of Preferred Stock purchasable after such event upon proper exercise of each Right shall be determined by multiplying the number of one-ten-thousandths of a share of Preferred Stock so purchasable immediately prior to such event by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately before such event and the denominator of which is the number of shares of Common Stock outstanding immediately after such event, and (z) each share of Common Stock outstanding immediately after such event shall have issued with respect to it that number of Rights which each share of Common Stock outstanding immediately prior to such event had issued with respect to it. The adjustments provided for in this Section 11(p) shall be made successively whenever such a dividend is declared or paid or such a subdivision, combination or consolidation is effected.

(p) The Company covenants and agrees that it shall not, at any time after the Distribution Date and so long as the Rights have not been redeemed pursuant to Section 23 hereof or exchanged pursuant to Section 24 hereof, (i) consolidate with, (ii) merge with or into, or (iii) sell or transfer, in one or more transactions, assets or earning power aggregating more than 50% of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to, any other Person, if at the time of or immediately after such consolidation, merger or sale there are any rights, warrants or other instruments or securities outstanding or agreements in effect which would substantially diminish or otherwise eliminate the benefits intended to be afforded by the Rights.

(q) The Company covenants and agrees that, after the Stock Acquisition Date, it will not, except as permitted by Sections 23 and 24 hereof, take any action the purpose or effect of which is to diminish substantially or otherwise eliminate the benefits intended to be afforded by the Rights.

Section 12. Certificate of Adjusted Purchase Price or Number of Shares. Whenever an adjustment is made or any event affecting the Rights or their exercisability (including without limitation an event which causes Rights to become null and void) occurs, as provided in Sections 11 or 13 hereof, the Company shall (a) promptly prepare a certificate setting forth such adjustment, and a brief statement of the facts and calculations accounting for such adjustment, (b) promptly file with the Rights Agent and with each transfer agent for the Preferred Stock and the Common Stock a copy of such certificate and (c) include a brief summary thereof in a mailing to each holder of a Rights Certificate in accordance with Section 26 hereof, or prior to the Distribution Date, disclose a brief summary in a filing under the Exchange Act. The Rights Agent shall be fully protected in relying on any such certificate and on any adjustment therein contained and shall have no duty with respect to, and shall not be deemed to have knowledge of such adjustment or event unless and until it shall have received such certificate. The Rights Agent shall not be accountable with respect to, and shall incur no liability as a result of, the validity or value (or the kind or amount) of any Rights, Common Stock, Preferred Stock or of any securities or property which may at any time be issued or delivered upon the exercise of any Right or upon any adjustment pursuant to Section 11 hereof, and it makes no representation with respect thereto.

Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power.

(a) In the event that, directly or indirectly, at any time after a Person has become an Acquiring Person, (x) the Company shall consolidate with, or merge with and into, any other Person (other than a Subsidiary of the Company), (y) any Person (other than a Subsidiary of the Company) shall consolidate with or merge with and into the Company, and the Company shall be the continuing or surviving corporation of such merger and, in connection with such merger, all or part of the Common Stock shall be changed into or exchanged for stock or other securities of any other Person (or the Company) or cash or any other property, or (z) the Company shall sell, or otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise transfer), in one or more transactions, assets or earning power aggregating 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to any other Person other than to the Company or one or more of its wholly owned Subsidiaries,

then, and in each such case, proper provision shall be made so that (i) each holder of a Right, subject to Section 7(e) hereof, shall thereafter have the right to receive, upon the exercise thereof at the then current Purchase Price multiplied by the then number of one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable (or if a Section 11(b) Event has occurred prior to the first occurrence of a Section 13 Event, multiplying the number of such one-ten-thousandths of a share for which a Right was exercisable immediately prior to the first occurrence of a Section 11(b) Event by the Purchase Price in effect immediately prior to such first occurrence) in accordance with the terms of this Rights Agreement, in lieu of Preferred Stock, such number of shares of freely tradable Common Stock of the Principal Party (as hereinafter defined), free and clear of liens, rights of call or first refusal, encumbrances or other adverse claims, as shall be equal to the result obtained by (A) multiplying the then current Purchase Price by the number of one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable (or if a Section 11(b) Event has occurred prior to the first occurrence of a Section 13 Event, multiplying the number of such one-ten-thousandths of a share for which a Right was exercisable immediately prior to the first occurrence of a Section 11(b) Event by the Purchase Price in effect immediately prior to such first occurrence), and dividing that product by (B) 50% of the current market price per share of the Common Stock of such Principal Party (determined in the manner described in Section 11(f) hereof) on the date of consummation of such consolidation, merger, sale or transfer; (ii) the Principal Party shall thereafter be liable for, and shall assume, by virtue of such consolidation, merger, sale or transfer, all the obligations and duties of the Company pursuant to this Rights Agreement; (iii) the term "Company" shall thereafter be deemed to refer to such Principal Party, it being specifically intended that the provisions of Section 11 hereof, except for the provisions of
11(b), shall apply to such Principal Party; and (iv) such Principal Party shall take such steps (including, but not limited to, the authorization and reservation of a sufficient number of shares of its Common Stock to permit exercise of all outstanding Rights in accordance with this Section 13(a)) in connection with such consummation as may be necessary to assure that the provisions hereof shall thereafter be applicable, as nearly as reasonably may be, in relation to the shares of its Common Stock thereafter deliverable upon the exercise of the Rights.

(b) "Principal Party" shall mean:

(i) in the case of any transaction described in clause (x) or (y) of the first sentence of Section 13(a) hereof, the Person that is the issuer of any securities into which shares of Common Stock of the Company are converted in such merger or consolidation, and if no securities are so issued, the Person, including the Company, that is the other party to the merger or consolidation; and

(ii) in the case of any transaction described in clause
(z) of the first sentence of Section 13(a) hereof, the Person that is the party receiving the greatest portion of the assets or earning power transferred pursuant to such transaction or transactions; provided, however, that in any case described in clause (i) or (ii) in this
Section 13(b), (x) if the Common Stock of such Person is not at such time and has not been continuously over the preceding 12 month period registered under Section 12 of the Exchange Act, and such Person is a direct or indirect Subsidiary or Affiliate of another Person, "Principal Party" shall refer to such other Person; (y) in case such Person is a Subsidiary, directly or indirectly, or Affiliate of more than one Person, the Common

Stocks of all of which are and have been so registered, "Principal Party" shall refer to whichever of such Persons is the issuer of the Common Stock having the greatest aggregate market value, and (z) in case such Person is, or is owned directly or indirectly by, a partnership or joint venture formed by two or more Persons that are not owned, directly or indirectly, by the same Person, the rules set forth in (x) and (y) above shall apply to each of the chains of ownership having an interest in such joint venture as if such party were a "Subsidiary" of both or all of such joint venturers and the Principal Parties in each such chain shall bear the obligations set forth in this Section 13 in the same ratio as their direct or indirect interests in such Person bear to the total of such interests.

(c) The Company shall not consummate any such consolidation, merger, sale or transfer unless the Principal Party shall have a sufficient number of shares of its authorized Common Stock which have not been issued or reserved for issuance to permit the exercise in full of the Rights in accordance with this Section 13 and unless prior thereto the Company and each Principal Party and each other Person who may become a Principal Party as a result of such consolidation, merger, sale or transfer shall have executed and delivered to the Rights Agent a supplemental agreement providing for the terms set forth in paragraphs (a) and (b) of this Section 13 and further providing that, as soon as practicable after the date of any consolidation, merger, sale or transfer of assets mentioned in paragraph (a) of this Section 13, the Principal Party will:

(i) prepare and file a registration statement under the Securities Act with respect to the Rights and the securities purchasable upon exercise of the Rights on an appropriate form, will use its best efforts to cause such registration statement to become effective as soon as practicable after such filing and will use its best efforts to cause such registration statement to remain effective (with a prospectus at all times meeting the requirements of the Securities Act) until the Expiration Date;

(ii) use its best efforts to qualify or register the Rights and the securities purchasable upon exercise of the Rights under the "blue sky laws" of such jurisdictions as may be necessary or appropriate; and

(iii) will deliver to holders of the Rights historical financial statements for the Principal Party and each of its Affiliates which comply in all respects with the requirements for registration on Form 10 under the Exchange Act.

The provisions of this Section 13 shall similarly apply to successive mergers or consolidations or sales or other transfers. In the event that a Section 13 Event shall occur at any time after the occurrence of a
Section 11(b) Event, the Rights which have not theretofore been exercised shall thereafter also become exercisable in the manner described in Section 13(a) hereof.

Section 14. Fractional Rights and Fractional Shares.

(a) The Company shall not be required to issue fractions of Rights or to distribute Right Certificates which evidence fractional Rights. In lieu of such fractional Rights, there shall be paid to the registered holders of the Right Certificates with regard to which such

fractional Rights would otherwise be issuable, an amount in cash equal to the same fraction of the current market value of a whole Right. For the purposes of this Section 14(a), the current market value of a whole Right shall be the closing price of the Rights for the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable. The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange or, if the Rights are not listed or admitted to trading on the New York Stock Exchange, as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the principal national securities exchange on which the Rights are listed or admitted to trading or, if the Rights are not listed or admitted to trading on any national securities exchange, as reported by the Nasdaq National Market or, if the Rights are not listed or admitted to trading on any national securities exchange or included in the Nasdaq National Market, the last quoted price, or, if not so quoted, the average of the high bid and low asked prices in the over the counter market, as reported by Nasdaq or such other system then in use or, if on any such date the Rights are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Rights selected by a majority of the Board of Directors. If on any such date no such market maker is making a market in the Rights, the fair value of the Rights on such date as determined in good faith by a majority of the Board of Directors shall be used.

(b) The Company shall not be required to issue fractions of shares of Preferred Stock (other than fractions which are integral multiples of one ten-thousandth of a share of Preferred Stock) upon exercise of the Rights or to distribute certificates which evidence fractional shares of Preferred Stock (other than fractions which are integral multiples of one ten-thousandth of a share of Preferred Stock). Fractions of shares of Preferred Stock in integral multiples of one ten-thousandth of a share of Preferred Stock may, at the election of the Company, be evidenced by depositary receipts, pursuant to an appropriate agreement between the Company and a depositary selected by it, provided that such agreement shall provide that the holders of such depositary receipts shall have all the rights, privileges and preferences to which they are entitled as beneficial owners of the shares of Preferred Stock represented by such depositary receipts. In lieu of fractional shares of Preferred Stock that are not integral multiples of one ten-thousandth of a share of Preferred Stock, the Company may pay to the registered holders of Right Certificates at the time such Right Certificates are exercised as herein provided an amount in cash equal to the same fraction of the current market value of one ten-thousandth of a share of Preferred Stock. For purposes of this Section 14(b), the current market value of one ten-thousandth of a share of Preferred Stock shall be one ten-thousandth of the closing price of a share of Preferred Stock (as determined pursuant to Section 11(f)(ii) hereof) for the Trading Day immediately prior to the date of such exercise.

(c) Following the occurrence of one of the transactions or events specified in Section 11 hereof giving rise to the right to receive common stock equivalents (other than Preferred Stock) or other securities upon the exercise of a Right, the Company shall not be required to issue fractions of shares or units of such common stock equivalents or other securities upon exercise of the Rights or to distribute certificates which evidence fractional shares of such common stock equivalents or other securities. In lieu of fractional shares or units of such

common stock equivalents or other securities, the Company may pay to the registered holders of Right Certificates at the time such Rights are exercised as herein provided an amount in cash equal to the same fraction of the current market value of a share or unit of such common stock equivalent or other securities. For purposes of this Section 14(c), the current market value shall be determined in the manner set forth in Section 11(f) hereof for the Trading Day immediately prior to the date of such exercise and, if such common stock equivalent is not traded, each such common stock equivalent shall have the value of one ten-thousandth of a share of Preferred Stock.

(d) Except as otherwise expressly provided in this Section 14, the holder of a Right by the acceptance of the Right expressly waives such holder's right to receive any fractional Rights or any fractional share upon exercise of Rights.

(e) Whenever a payment for fractional Rights or fractional shares is to be made by the Rights Agent, the Company shall (i) promptly prepare and deliver to the Rights Agent, a certificate setting forth in reasonable detail the facts related to such payments and the prices and/or formulas utilized in calculating such payments, and (ii) provide sufficient monies to the Rights Agent in the form of fully collected funds to make such payments. The Rights Agent shall be fully protected in relying upon such a certificate and shall have no duty with respect to, and shall not be deemed to have knowledge of any payment for fractional Rights or fractional shares under any Section of this Agreement relating to the payment of fractional Rights or fractional shares unless and until the Rights Agent shall have received such a certificate and sufficient monies.

Section 15. Rights of Action.

(a) All rights of action in respect of this Rights Agreement, except for rights of action given to the Rights Agent under Section 18 or
Section 20 hereof, are vested in the respective registered holders of the Right Certificates (and, prior to the Distribution Date, the registered holders of Common Stock); and any registered holder of any Right Certificate (or, prior to the Distribution Date, of the Common Stock), without the consent of the Rights Agent or of the holder of any other Right Certificate (or, prior to the Distribution Date, of the Common Stock), may, in such holder's own behalf and for such holder's own benefit, enforce, and may institute and maintain any suit, action or proceeding against the Company to enforce, or otherwise act in respect of, such holder's right to exercise the Rights evidenced by such Right Certificate in the manner provided in such Right Certificate and in this Rights Agreement. Without limiting the foregoing or any remedies available to the holders of Rights, it is specifically acknowledged that the holders of Rights would not have an adequate remedy at law for any breach of this Rights Agreement and will be entitled to specific performance of the obligations under, and injunctive relief against actual or threatened violations of, the obligations of any Person subject to this Rights Agreement. Holders of Rights shall be entitled to recover the reasonable costs and expenses, including attorneys' fees, incurred by them in any action to enforce the provisions of this Rights Agreement.

(b) Notwithstanding anything in this Agreement to the contrary, neither the Company nor the Rights Agent shall have any liability to any holder of a Right or other Person as a result of its inability to perform any of its obligations under this Agreement by reason of any

preliminary or permanent injunction or other order, judgment, decree or ruling (whether interlocutory or final) issued by a court or by a governmental, regulatory, self-regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation; provided, however, that the Company must use all reasonable efforts to have any such injunction, order, judgment, decree or ruling lifted or otherwise overturned as soon as possible.

Section 16. Agreement of Right Holders. Every holder of a Right by accepting the same consents and agrees with the Company and the Rights Agent and with every other holder of a Right that:

(a) prior to the Distribution Date, the Rights will be transferable only in connection with the transfer of Common Stock;

(b) after the Distribution Date, the Right Certificates are transferable only on the registry books of the Rights Agent if surrendered at the stockholder services office of the Rights Agent or such office designated for such purpose, duly endorsed or accompanied by a proper instrument of transfer; and

(c) the Company and the Rights Agent may deem and treat the Person in whose name the Right Certificate (or, prior to the Distribution Date, the associated Common Stock Certificate) is registered as the absolute owner thereof and of the Rights evidenced thereby (notwithstanding any notations of ownership or writing on the Right Certificate or the associated Common Stock certificate made by anyone other than the Company or the Rights Agent) for all purposes whatsoever, and neither the Company nor the Rights Agent shall be affected by any notice to the contrary.

Section 17. Right Certificate Holder Not Deemed a Stockholder. No holder, as such, of any Right Certificate shall be entitled to vote, receive dividends or be deemed for any purpose the holder of Preferred Stock, Common Stock or any other securities of the Company which may at any time be issuable on the exercise of the Rights represented thereby, nor shall anything contained herein or in any Right Certificate be construed to confer upon the holder of any Right Certificate, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in Section 25 hereof), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by such Right Certificate shall have been exercised in accordance with the provisions hereof.

Section 18. Concerning the Rights Agent.

(a) The Company agrees to pay to the Rights Agent reasonable compensation for all services rendered by it hereunder and, from time to time, on demand of the Rights Agent, its reasonable expenses and counsel fees and other disbursements incurred in the preparation, administration, delivery, execution and amendment of this Agreement and the exercise and performance of its duties hereunder. The Company also agrees to indemnify the Rights Agent

for, and to hold it harmless against, any loss, liability, damage, judgment, fine, penalty, claim, demand, settlement , cost or expense (including, without limitation, the reasonable fees and expenses of legal counsel) incurred without gross negligence, bad faith or willful misconduct on the part of the Rights Agent (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling of a court of competent jurisdiction), for any action taken, suffered or omitted by the Rights Agent in connection with the acceptance, exercise, performance or administration of its duties under this Agreement, including, without limitation, the costs and expenses of defending against any claim of liability in the premises. The costs and expenses incurred by the Rights Agent in enforcing this right of indemnification shall be paid by the Company. The provisions of this Section 18 and Section 20 below shall survive the termination of this Agreement, the exercise or expiration of the Rights and the resignation or removal of the Rights Agent.

(b) The Rights Agent shall be authorized and protected and shall incur no liability for or in respect of any action taken, suffered or omitted by it in connection with its administration of this Rights Agreement or the exercise or performance of its duties hereunder, in reliance upon any Right Certificate or certificate for Preferred Stock, Common Stock or for other securities of the Company, instrument of assignment or transfer, power of attorney, endorsement, affidavit, letter, notice, instruction, direction, consent, certificate, statement, or other paper or document believed by it to be genuine and to be signed, executed and, where necessary, verified or acknowledged, by the proper Person or Persons, or otherwise upon the advice of counsel as set forth in Section 20 hereof. The Rights Agent shall not be deemed to have knowledge of any event of which it was supposed to receive notice thereof hereunder, and the Rights Agent shall be fully protected and shall incur no liability for failing to take any action in connection therewith unless and until it has received such notice.

Section 19. Merger or Consolidation or Change of Name of Rights Agent.

(a) Any Person into which the Rights Agent or any successor Rights Agent may be merged or with which it may be consolidated, or any Person resulting from any merger or consolidation to which the Rights Agent or any successor Rights Agent shall be a party, or any Person succeeding to the business of the Rights Agent or any successor Rights Agent, shall be the successor to the Rights Agent under this Rights Agreement without the execution or filing of any paper or any further act on the part of any of the parties hereto, provided that such Person would be eligible for appointment as a successor Rights Agent under the provisions of Section 21 hereof. In case at the time such successor Rights Agent shall succeed to the agency created by this Rights Agreement, any of the Right Certificates shall have been countersigned but not delivered, any such successor Rights Agent may adopt the countersignature of the predecessor Rights Agent and deliver such Right Certificates so countersigned; and in case at that time any of the Right Certificates shall not have been countersigned, any successor Rights Agent may countersign such Right Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent; and in all such cases such Right Certificates shall have the full force provided in the Right Certificates and in this Rights Agreement.

(b) In case at any time the name of the Rights Agent shall be changed and at such time any of the Right Certificates shall have been countersigned but not delivered, the Rights Agent may adopt the countersignature under its prior name and deliver Right Certificates

so countersigned; and in case at that time any of the Right Certificates shall not have been countersigned, the Rights Agent may countersign such Right Certificates either in its prior name or in its changed name; and in all such cases such Right Certificates shall have the full force provided in the Right Certificates and in this Rights Agreement.

20. Duties of Rights Agent. The Rights Agent undertakes to perform only the duties and obligations expressly imposed by this Rights Agreement (and no implied duties or obligations) upon the following terms and conditions, by all of which the Company and the holders of Right Certificates, by their acceptance thereof, shall be bound:

(a) The Rights Agent may consult with legal counsel (who may be legal counsel for the Company or any employee of the Rights Agent) and the advice or opinion of such counsel shall be full and complete authorization and protection to the Rights Agent and the Rights Agent shall incur no liability for or in respect of any action taken or omitted by it in the absence of gross negligence, bad faith or willful misconduct and in accordance with such advice or opinion.

(b) Whenever in the performance of its duties under this Rights Agreement the Rights Agent shall deem it necessary or desirable that any fact or matter be proved or established by the Company prior to taking, omitting or suffering any action hereunder, such fact or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established by a certificate signed by the Chairman, President and Chief Executive Officer, Chief Financial Officer or any Vice President and by the Treasurer or any Assistant Treasurer or the Secretary or any Assistant Secretary of the Company and delivered to the Rights Agent; and such certificate shall be full and complete authorization and protection to the Rights Agent, and the Rights Agent shall incur no liability for or in respect of, any action taken, omitted or suffered by it in the absence of gross negligence, bad faith or willful misconduct under the provisions of this Rights Agreement in reliance upon such certificate.

(c) The Rights Agent shall be liable hereunder to the Company and any other Person only for its own gross negligence, bad faith or willful misconduct (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree or ruling of a court of competent jurisdiction). Anything to the contrary notwithstanding, in no event shall the Rights Agent be liable for special, punitive, indirect, consequential or incidental loss or damage of any kind whatsoever (including, but not limited to, lost profits), even if the Rights Agent has been advised of the likelihood of such loss or damage. Any and all liability of the Rights Agent under this Agreement will be limited to the amount of fees paid by the Company to the Rights Agent pursuant to this Agreement.

(d) The Rights Agent shall not be liable for or by reason of any of the statements of fact or recitals contained in this Rights Agreement or in the Right Certificates (except its countersignature thereof) or be required to verify the same, but all such statements and recitals are and shall be deemed to have been made by the Company only.

(e) The Rights Agent shall not have any liability for or be under any responsibility in respect of the validity of this Rights Agreement or the execution and delivery

hereof (except the due execution hereof by the Rights Agent) or in respect of the validity or execution of any Right Certificate (except its countersignature thereof); nor shall it be responsible for any breach by the Company of any covenant or condition contained in this Rights Agreement or in any Right Certificate; nor shall it be responsible for any change in the exercisability of the Rights (including the Rights becoming null and void hereunder) or for any adjustment required under the provisions of Sections 11 or 13 hereof or responsible for the manner, method or amount of any such adjustment or the ascertaining of the existence of facts that would require any such adjustment (except with respect to the exercise of Rights evidenced by Right Certificates after actual notice to the Rights Agent of any such adjustment, upon which the Rights Agent may rely); nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization or reservation of any shares of Preferred Stock or other securities to be issued pursuant to this Rights Agreement or any Right Certificate or as to whether any shares of Preferred Stock or other securities will, when issued, be validly authorized and issued, fully paid and nonassessable.

(f) The Company agrees that it will perform, execute, acknowledge and deliver or cause to be performed, executed, acknowledged and delivered all such further and other acts, instruments and assurances as may reasonably be required by the Rights Agent for the carrying out or performing by the Rights Agent of the provisions of this Rights Agreement.

(g) The Rights Agent is hereby authorized and directed to accept instructions with respect to the performance of its duties hereunder from any one of the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, any Vice President, the Secretary, any Assistant Secretary, the Treasurer or any Assistant Treasurer of the Company, and to apply to such officers for advice or instructions in connection with its duties and such instructions shall be full authorization and protection to the Rights Agent, and the Rights Agent shall not be liable for any action taken, omitted or suffered to be taken by it in the absence of gross negligence, bad faith or willful misconduct in accordance with instructions of any such officer or for any delay in acting while waiting for those instructions. Any application by the Rights Agent for written instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken, omitted or suffered by the Rights Agent under this Rights Agreement and the date on and/or after which such action shall be taken or such omission shall be effective. The Rights Agent shall not be liable for any action taken or suffered by, or omission of, the Rights Agent in accordance with a proposal included in any such application on or after the date specified in such application (which date shall not be less than ten (10) Business Days after the date on which any officer of the Company actually receives such application, unless any such officer shall have consented in writing to an earlier date) unless, prior to taking any such action (or the effective date in the case of an omission), the Rights Agent shall have received written instructions in response to such application specifying the action to be taken, suffered or omitted.

(h) The Rights Agent and any stockholder, director, officer, employee, agent or representative or Affiliate of the Rights Agent may buy, sell or deal in any of the Rights or other securities of the Company or become pecuniarily interested in any transaction in which the Company may be interested, or contract with or lend money to the Company or otherwise act as fully and freely as though it were not the Rights Agent under this Rights Agreement. Nothing

herein shall preclude the Rights Agent from acting in any other capacity for the Company or for any other legal entity.

(i) The Rights Agent may execute and exercise any of the rights or powers hereby vested in it or perform any duty hereunder either itself or by or through its attorneys or agents, and the Rights Agent shall not be answerable or accountable for any act, default, neglect or misconduct of any such attorneys or agents or for any loss to the Company resulting from any such act, default, neglect or misconduct, provided that reasonable care was exercised in the selection and continued employment thereof.

(j) No provision of this Rights Agreement shall require the Rights Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of its rights if it believes that repayment of such funds or adequate indemnification against such risk or financial liability is not reasonably assured to it.

(k) If, with respect to any Rights Certificate surrendered to the Rights Agent for exercise or transfer, the certificate attached to the form of assignment or form of election to purchase, as the case may be, has either not been completed or indicates an affirmative response to clause 1, clause 2 and/or, in the case of the certificate attached to the form of election to purchase, clause 3 thereof, the Rights Agent shall not take any further action with respect to such requested exercise of transfer without first consulting with the Company.

Section 21. Change of Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Rights Agreement upon 30 days' notice in writing mailed to the Company and to each transfer agent of the Common Stock or Preferred Stock known to the Rights Agent by registered or certified mail, and to the holders of the Right Certificates by first class mail. The Company may remove the Rights Agent or any successor Rights Agent upon 30 days' notice in writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Common Stock and Preferred Stock by registered or certified mail, and to the holders of the Right Certificates by first class mail or, prior to the Distribution Date, through any filing made by the Company pursuant to the Exchange Act. If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a period of 30 days after such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Right Certificate (which holder shall, with such notice, submit such holder's Right Certificate for inspection by the Company), then the registered holder of any Right Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such a court, shall be (a) a corporation or other entity organized and doing business under the laws of the United States or of any state, in good standing, having an office in the States of New York or Missouri, which is authorized under such laws to exercise corporate trust or stock transfer powers and is subject to supervision or examination by federal or state authority or (b) an affiliate of a corporation or other entity described in clause (a) of this sentence. After appointment, the successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Rights Agent without further act or deed; but the predecessor Rights Agent shall deliver and transfer to the successor Rights Agent any

property at the time held by it hereunder, and execute and deliver any further assurance, conveyance, act or deed necessary for the purpose. Not later than the effective date of any such appointment the Company shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Common Stock and Preferred Stock, and mail a notice thereof in writing to the registered holders of the Right Certificates or, prior to the Distribution Date, through any filing made by the Company pursuant to the Securities Exchange Act of 1934, as amended. Failure to give any notice provided for this Section 21, however, or any defect therein, shall not affect the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.

Section 22. Issuance of New Right Certificates.

(a) Notwithstanding any of the provisions of this Rights Agreement or of the Rights to the contrary, the Company may, at its option, issue new Right Certificates evidencing Rights in such form as may be approved by a majority of the Board of Directors then in office to reflect any adjustment or change in the Purchase Price and the number or kind or class of shares of stock or other securities or property purchasable under the Right Certificates made in accordance with the provisions of this Rights Agreement.

(b) In addition, in connection with the issuance or sale of Common Stock following the Distribution Date and prior to the redemption, exchange or expiration of the Rights, the Company (a) shall with respect to shares of Common Stock so issued or sold pursuant to the exercise of stock options or under any employee benefit plan or arrangement, or upon the exercise, conversion or exchange of securities hereinafter issued by the Company, and (b) may, in any other case, if deemed necessary or appropriate by the Board of Directors, issue Right Certificates representing the appropriate number of Rights in connection with such issuance or sale; provided, however, that (i) no such Right Certificates shall be issued if, and to the extent that, the Company shall be advised by counsel that such issuance would create a significant risk of material adverse tax consequences to the Company or the Person to whom such Right Certificates would be issued, and (ii) no Right Certificate shall be issued if, and to the extent that, appropriate adjustment shall otherwise have been made in lieu of the issuance thereof.

Section 23. Redemption and Termination.

(a) A majority of the Board of Directors then in office may, at its option, at any time prior to the earlier of (i) the Close of Business on the Stock Acquisition Date or (ii) the Close of Business on the Final Expiration Date, elect to redeem all but not less than all of the then outstanding Rights at a redemption price of $0.01 per Right, as appropriately adjusted to reflect any stock split, stock dividend or similar transaction occurring after the date hereof (such redemption price being hereinafter referred to as the "Redemption Price"). The redemption of the Rights by the Board of Directors may be made effective at such time, on such basis and with such conditions as the Board of Directors in its sole discretion may establish.

(b) Immediately upon the action of a majority of the Board of Directors then in office electing to redeem the Rights, evidence of which shall be promptly filed with the Rights Agent, or, when appropriate, immediately upon the time or satisfaction of such conditions as the

Board of Directors may have established, and without any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the holders of Rights shall be to receive the Redemption Price. The Company shall promptly give public disclosure of any such redemption (with prompt written notice thereof to the Rights Agent); provided, however, that the failure to give, or any defect in, any such disclosure shall not affect the validity of such redemption. Within 10 days after the action of the Board of Directors ordering the redemption of the Rights, the Company shall give notice of such redemption to the holders of the then outstanding Rights by mailing such notice to all such holders at their last addresses as they appear upon the registry books of the Rights Agent or, prior to the Distribution Date, on the registry books of the Transfer Agent for the Common Stock. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice of redemption will state the method by which the payment of the Redemption Price will be made.

(c) Neither the Company nor any of its Affiliates or Associates may redeem, acquire or purchase for value any Rights at any time in any manner other than that specifically set forth in this Section 23 or in Section 24 hereof and other than in connection with the purchase of Common Stock prior to the Distribution Date.

Section 24. Exchange.

(a) The Board of Directors may, at its option, at any time after any Person becomes an Acquiring Person, exchange all or part of the then outstanding and exercisable Rights (which shall not include Rights that have become null and void pursuant to the provisions of Section 7(e) hereof) for Common Stock at an exchange ratio of one share of Common Stock per Right, appropriately adjusted to reflect adjustments in the number of Rights pursuant to Section 11 of this Rights Agreement (such exchange ratio being hereinafter referred to as the "Exchange Ratio"). Notwithstanding the foregoing, the Board of Directors shall not be empowered to effect such exchange at any time after any Person (other than the Company, any Subsidiary of the Company, any employee benefit plan or compensation arrangement of the Company or any such Subsidiary, or any entity holding securities of the Company to the extent organized, appointed or established by the Company or any such Subsidiary for or pursuant to the terms of any such employee benefit plan or compensation arrangement), together with all Affiliates and Associates of such Person, becomes the Beneficial Owner of 50% or more of the Voting Power of the Company.

(b) Immediately upon the action of the Board of Directors ordering the exchange of any Rights pursuant to paragraph (a) of this Section 24 and without any further action and without any notice, the right to exercise such Rights shall terminate and the only right thereafter of a holder of such Rights shall be to receive that number of shares of Common Stock equal to the number of such Rights held by such holder multiplied by the Exchange Ratio. The Company promptly shall give public notice of any such exchange (with prompt written notice thereof to the Rights Agent); provided, however, that the failure to give, or any defect in, such notice shall not affect the validity of such exchange. The Company promptly shall mail a notice of any such exchange to all of the holders of such Rights at their last addresses as they appear upon the registry books of the Rights Agent. Any notice which is mailed in the manner herein provided shall be deemed given, whether or not the holder receives the notice. Each such notice

of exchange will state the method by which the exchange of Common Stock for Rights will be effected and, in the event of any partial exchange, the number of Rights which will be exchanged. Any partial exchange shall be effected pro rata based on the number of Rights (other than Rights which have become null and void pursuant to the provisions of Section 7(e) hereof) held by each holder of Rights.

(c) In any exchange pursuant to this Section 24, the Company, at its option, may substitute Preferred Stock (or equivalent preferred stock, as such term is defined in Section 11(d) hereof) for Common Stock exchangeable for Rights, at the initial rate of one ten-thousandth of a share of Preferred Stock (or equivalent preferred stock) for each share of Common Stock, as appropriately adjusted to reflect adjustments in the voting rights of the Preferred Stock pursuant to the terms thereof, so that the fraction of a share of Preferred Stock delivered in lieu of each share of Common Stock shall have the same voting rights as one share of Common Stock.

(d) In the event that there shall not be sufficient shares of Common Stock or Preferred Stock (or equivalent preferred stock) issued but not outstanding or authorized but unissued to permit any exchange of Rights as contemplated in accordance with this Section 24, the Company shall take all such action as may be necessary to authorize additional shares of Common Stock or Preferred Stock (or equivalent preferred stock) for issuance upon exchange of the Rights.

(e) The Company shall not be required to issue fractions of Common Stock or to distribute certificates which evidence fractional shares of Common Stock. In lieu of such fractional shares of Common Stock, the Company shall pay to the registered holders of the Right Certificates with regard to which such fractional shares of Common Stock would otherwise be issuable an amount in cash equal to the same fraction of the current market value of a whole share of Common Stock. For the purposes of this paragraph (e), the current market value of a whole share of Common Stock shall be the closing price of a share of Common Stock (as determined pursuant to the second sentence of Section 11(f)(i) hereof) for the Trading Day immediately prior to the date of exchange pursuant to this Section 24.

Section 25. Notice of Proposed Actions.

(a) In case the Company shall propose at any time after the Distribution Date (i) to pay any dividend payable in stock of any class to the holders of the Preferred Stock or to make any other distribution to the holders of the Preferred Stock (other than a regular periodic cash dividend out of earnings or retained earnings of the Company), (ii) to offer to the holders of the Preferred Stock rights or warrants to subscribe for or to purchase any additional shares of Preferred Stock or shares of stock of any other class or any other securities, rights or options, (iii) to effect any reclassification of the Preferred Stock (other than a reclassification involving only the subdivision of outstanding shares of Preferred Stock), (iv) to effect any consolidation or merger into or with, or to effect any sale or other transfer (or to permit one or more of its Subsidiaries to effect any sales or other transfer), in one or more transactions, of 50% or more of the assets or earning power of the Company and its Subsidiaries (taken as a whole) to, any other Person, (v) to effect the liquidation, dissolution or winding up of the Company, or (vi) to declare or pay any dividend on the Common Stock payable in Common Stock or to effect a subdivision,

combination or consolidation of the Common Stock (by reclassification or otherwise than by payment of dividends in Common Stock), then, in each such case, the Company shall give to each holder of a Right, in accordance with
Section 26 hereof, a notice of such proposed action (with prompt written notice thereof to the Rights Agent), which shall specify the record date for the purposes of such stock dividend, distribution of rights or warrants, or the date on which such reclassification, consolidation, merger, sale, transfer, liquidation, dissolution, or winding up is to take place and the date of participation therein by the holders of the Common Stock and/or Preferred Stock, if any such date is to be fixed. Such notice shall be so given in the case of any action covered by clauses (i) or (ii) above at least ten days prior to the record date for determining holders of the Preferred Stock for purposes of such action, and in the case of any such other action, at least ten days prior to the date of the taking of such proposed action or the date of participation therein by the holders of Preferred Stock, whichever shall be the earlier. The failure to give notice required by this Section 25 or any defect therein shall not affect the legality or validity of the action taken by the Company or the vote upon any such action.

(b) In case a Section 11(b) Event shall occur, then the Company shall as soon as practicable thereafter give to each holder of a Right Certificate, in accordance with Section 26 hereof, a notice of the occurrence of such event (with prompt written notice thereof to the Rights Agent), which shall specify the event and the consequences of the event to holders of Rights under
Section 11(b) hereof.

Section 26. Notices. Notices or demands authorized by this Rights Agreement to be given or made by the Rights Agent or by the holder of any Right Certificate to or on the Company shall be sufficiently given or made if sent by first class mail, postage prepaid, addressed (until another address is filed in writing with the Rights Agent) or by facsimile transmission as follows:

SCS Transportation, Inc.
4435 Main Street, Suite 930 Kansas City, Missouri 64111 Facsimile No.:

Attention: Chief Financial Officer

Subject to the provisions of Section 21 hereof, any notice or demand authorized by this Rights Agreement to be given or made by the Company or by the holder of any Right Certificate to or on the Rights Agent shall be sufficiently given or made if sent by first class mail, postage prepaid, addressed (until another address is filed in writing with the Company) or by facsimile transmission as follows:

Mellon Investor Services LLC 150 North Wacker Drive, Suite 2120 Chicago, Illinois 60606
Facsimile No.: (312) 704-7112 Attention: Relationship Manager

with a copy to

Mellon Investor Services LLC 85 Challenger Road
Ridgefield Park, New Jersey 07660 Facsimile No.: (201) 296-4004 Attention: General Counsel

Notices or demands authorized by this Rights Agreement to be given or made by the Company or the Rights Agent to the holder of any Right Certificate shall be sufficiently given or made if sent by first class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the registry books of the Company.

Section 27. Supplements and Amendments. The Company may from time to time supplement or amend this Rights Agreement without the approval of any holders of Right Certificates in order (a) to cure any ambiguity, (b) to correct or supplement any provision contained herein which may be defective or inconsistent with any other provisions herein, (c) to shorten or lengthen any time period hereunder (including without limitation to extend the Final Expiration Date), (d) increase or decrease the Purchase Price, or (e) to change or supplement the provisions hereunder in any manner which the Company may deem necessary or desirable; provided, however, that from and after such time as any Person becomes an Acquiring Person, this Rights Agreement shall not be amended in any manner which would adversely affect the interests of the holders of Rights; provided further that this Rights Agreement may not be supplemented or amended to lengthen pursuant to clause (c) of this sentence, (A) the time period relating to the when the Rights may be redeemed at such time as the Rights are not then redeemable, or (B) any other time period unless such lengthening is for the purpose of protecting, enhancing or clarifying the rights of, and/or the benefits to, the holders of the Rights; provided further that the Company shall have the right to make unilaterally any changes necessary to facilitate the appointment of a successor Rights Agent, which such changes shall be set forth in a writing by the Company or by the Company and such successor Rights Agent. Without limiting the foregoing, the Company may at any time prior to such time as any Person becomes an Acquiring Person amend this Rights Agreement to lower the thresholds set forth in Sections 1(a) and 3(a) hereof from 15% to not less than the greater of (i) any percentage greater than the largest percentage of the Voting Power of the Company then known by the Company to be beneficially owned by any Person (other than the Company, any Subsidiary of the Company, or any employee benefit plan or compensation arrangement of the Company or any Subsidiary of the Company, and any entity holding securities of the Company to the extent organized, appointed or established by the Company or any such Subsidiary for or pursuant to the terms of any such employee benefit plan or compensation arrangement) together with all Affiliates and Associates of such Person and (ii) 10%. Upon the delivery of a certificate from an appropriate officer of the Company which states that the proposed supplement or amendment is in compliance with the terms of this Section 27, and provided that such supplement or amendment does not increase the Rights Agent's rights, duties, liabilities or obligations, the Rights Agent shall execute such supplement or amendment.

Section 28. Successors. All the covenants and provisions of this Rights Agreement by or for the benefit of the Company or the Rights Agent shall bind and inure to the benefit of their respective successors and assigns hereunder.

Section 29. Benefits of This Rights Agreement. Nothing in this Rights Agreement shall be construed to give to any Person other than the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Common Stock) any legal or equitable right, remedy or claim under this Rights Agreement; but this Rights Agreement shall be for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of the Right Certificates (and, prior to the Distribution Date, the Common Stock).

Section 30. Severability. If any term, provision, covenant or restriction of this Rights Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Rights Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated. It is the intent of the parties hereto to enforce the remainder of the terms, provisions, covenants and restrictions of this Rights Agreement to the maximum extent permitted by law.

Section 31. Governing Law. This Rights Agreement and each Right Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed by and construed in accordance with the laws of such State applicable to contracts to be made and performed entirely within such State.

Section 32. Counterparts. This Rights Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

Section 33. Descriptive Headings. Descriptive headings of the several Sections of this Rights Agreement are inserted for convenience only and shall not control or affect the meaning or construction of any of the provisions hereof.

IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement to be duly executed, all as of the day and year first above written.

Attest:                                 SCS TRANSPORTATION, INC.

By     /s/ James J. Bellinghausen       By     /s/ Herbert A. Trucksess, III
       ------------------------------          ---------------------------------
Name:  James J. Bellinghausen           Name:  Herbert A. Trucksess, III
Title: Vice President Finance and       Title: President and Chief Executive
       Chief Financial Officer                 Officer


Attest:                                 MELLON INVESTOR SERVICES LLC

By     /s/ Ruth A. Brunette             By     /s/ Jane A. Marten
       ------------------------------          ---------------------------------
Name:  Ruth A. Brunette                 Name:  Jane A. Marten
Title: Assistant Vice President         Title: Assistant Vice President

Exhibit A

FORM OF
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK

SCS TRANSPORTATION, INC.

PURSUANT TO SECTION 151(G) OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE

We, Herbert A. Trucksess III, Chairman, President and Chief Executive Officer, and James J. Bellinghausen, Vice President and Chief Financial Officer, of SCS Transportation, Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware (the "Company"), in accordance with the provisions of Section 151(g) thereof, DO HEREBY CERTIFY:

That pursuant to the authority conferred upon the Board of Directors by the Certificate of Incorporation, as amended, of the Company, the said Board of Directors on September 17, 2002, adopted the following resolution creating a series of Five Thousand (5,000) shares of Preferred Stock designated as Series A Junior Participating Preferred Stock:

RESOLVED, that pursuant to the authority vested in the Board of Directors of the Company in accordance with the provisions of its Amended and Restated Certificate of Incorporation, as amended, a series of Preferred Stock of the Company be and it hereby is created, and that the designation and amount thereof and the powers, preferences and relative, participating, optional and other special rights of the shares of such series, and the qualifications, limitations or restrictions thereof are as follows:

Section 1. Designation and Amount.

There shall be a series of the Preferred Stock which shall be designated as the "Series A Junior Participating Preferred Stock," par value $0.001 per share, and the number of shares constituting such series shall be 5,000. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Junior Participating Preferred Stock to a number less than that of the shares then outstanding plus the number of shares issuable upon exercise of outstanding rights, options or warrants or upon conversion of outstanding securities issued by the Company.

Section 2. Dividends and Distributions.

(A) Subject to the rights of the holders of any shares of any series of preferred stock of the Company ranking prior and superior to the Series A Junior Participating Preferred Stock with respect to dividends, the holders of shares of Series A Junior Participating Preferred Stock, in preference to the holders of shares of Common Stock, par value $0.001 per share of the Company (the "Common Stock"), and of any other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose,

quarterly dividends payable in cash on any regular quarterly dividend payment date as shall be established by the Board of Directors (each such date being referred to herein as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Junior Participating Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $1.00 or (b) subject to the provision for adjustment hereinafter set forth, 10,000 times the aggregate per share amount of all cash dividends, and 10,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Junior Participating Preferred Stock. In the event the Company shall at any time after September 30, 2002 (the "Rights Declaration Date") declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to which holders of shares of Series A Junior Participating Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

(B) The Company shall declare a dividend or distribution on the Series A Junior Participating Preferred Stock as provided in paragraph (A) of this Section immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $1.00 per share on the Series A Junior Participating Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.

(C) Dividends shall begin to accrue and be cumulative on outstanding shares of Series A Junior Participating Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Junior Participating Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Junior Participating Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share by share basis among all such shares at the time outstanding. The Board of Directors may, in accordance with applicable law, fix a record date for the determination of holders of shares of Series A Junior Participating Preferred Stock entitled to receive payment of a dividend or distribution declared

thereon, which record date shall be not more than such number of days prior to the date fixed for the payment thereof as may be allowed by applicable law.

Section 3. Voting Rights.

The holders of shares of Series A Junior Participating Preferred Stock shall have the following voting rights:

(A) Each share of Series A Junior Participating Preferred Stock shall entitle the holder thereof to 10,000 votes on all matters submitted to a vote of the stockholders of the Company. In the event the Company shall at any time after the Rights Declaration Date declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes to which holders of shares of Series A Junior Participating Preferred Stock were entitled immediately prior to such event under the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

(B) Except as otherwise provided herein, in the Company's Certificate of Incorporation or by law, the holders of shares of Series A Junior Participating Preferred Stock, the holders of shares of Common Stock, and the holders of shares of any other capital stock of the Company having general voting rights, shall vote together as one class on all matters submitted to a vote of stockholders of the Company.

(C) Except as otherwise set forth herein or in the Company's Certificate of Incorporation, and except as otherwise provided by law, holders of Series A Junior Participating Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate action.

Section 4. Certain Restrictions.

(A) Whenever dividends or distributions payable on the Series A Junior Participating Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Junior Participating Preferred Stock outstanding shall have been paid in full, the Company shall not:

(i) declare or pay dividends on, make any other distributions on, or redeem or purchase or otherwise acquire for consideration any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Junior Participating Preferred Stock;

(ii) declare or pay dividends on or make any other distributions on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution

or winding up) with the Series A Junior Participating Preferred Stock, except dividends paid ratably on the Series A Junior Participating Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled;

(iii) except as permitted in Section 4(A)(iv) below, redeem or purchase or otherwise acquire for consideration shares of any stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Junior Participating Preferred Stock, provided that the Company may at any time redeem, purchase or otherwise acquire shares of any such parity stock in exchange for shares of any stock of the Company ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Junior Participating Preferred Stock; and

(iv) purchase or otherwise acquire for consideration any shares of Series A Junior Participating Preferred Stock, or any shares of stock ranking on a parity with the Series A Junior Participating Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes.

(B) The Company shall not permit any subsidiary of the Company to purchase or otherwise acquire for consideration any shares of stock of the Company unless the Company could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner.

Section 5. Reacquired Shares.

Any shares of Series A Junior Participating Preferred Stock purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. The Company shall cause all such shares upon their cancellation to be authorized but unissued shares of Preferred Stock which may be reissued as part of a new series of Preferred Stock, subject to the conditions and restrictions on issuance set forth herein.

Section 6. Liquidation, Dissolution or Winding Up.

(A) Subject to the rights of the holders of any shares of any series of Preferred Stock of the Company ranking prior and superior to the Series A Junior Participating Preferred Stock with respect to liquidation, upon any liquidation (voluntary or otherwise), dissolution or winding up of the Company, no distribution shall be made to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Junior Participating Preferred Stock unless, prior thereto, the holders of shares of Series A Junior Participating Preferred Stock shall have received $10,000.00 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment (the "Series A Liquidation Preference"). Following the payment of the full

amount of the Series A Liquidation Preference, no additional distributions shall be made to the holders of shares of Series A Junior Participating Preferred Stock, unless, prior thereto, the holders of shares of Common Stock shall have received an amount per share (the "Common Adjustment") equal to the quotient obtained by dividing (i) the Series A Liquidation Preference by (ii) 10,000 (as appropriately adjusted as set forth in subparagraph C below to reflect such events as stock dividends, and subdivisions, combinations and consolidations with respect to the Common Stock) (such number in clause (ii) being referred to as the "Adjustment Number"). Following the payment of the full amount of the Series A Liquidation Preference and the Common Adjustment in respect of all outstanding shares of Series A Junior Participating Preferred Stock and Common Stock, respectively, holders of Series A Junior Participating Preferred Stock and holders of shares of Common Stock shall receive their ratable and proportionate share of the remaining assets to be distributed in the ratio of the Adjustment Number to 1 with respect to such Series A Junior Participating Preferred Stock and Common Stock, on a per share basis, respectively.

(B) In the event there are not sufficient assets available to permit payment in full of the Series A Liquidation Preference and the liquidation preferences of all other series of preferred stock, if any, which rank on a parity with the Series A Junior Participating Preferred Stock, then such remaining assets shall be distributed ratably to the holders of such parity shares in proportion to their respective liquidation preferences. In the event there are not sufficient assets available to permit payment in full of the Common Adjustment, then such remaining assets shall be distributed ratably to the holders of Common Stock.

(C) In the event the Company shall at any time after the Rights Declaration Date declare or pay any dividend on Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the Adjustment Number in effect immediately prior to such event shall be adjusted by multiplying such Adjustment Number by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.

Section 7. Consolidation, Merger, etc.

In case the Company shall enter into any consolidation, merger, combination or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case the shares of Series A Junior Participating Preferred Stock shall at the same time be similarly exchanged or changed in an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 10,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged. In the event the Company shall at any time after the Rights Declaration Date declare or pay any dividend on Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth

in the preceding sentence with respect to the exchange or change of shares of Series A Junior Participating Preferred Stock shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that are outstanding immediately prior to such event.

Section 8. Redemption.

The shares of Series A Junior Participating Preferred Stock shall not be redeemable.

Section 9. Ranking.

The Series A Junior Participating Preferred Stock shall rank junior to all other series of the Company's Preferred Stock as to the payment of dividends and the distribution of assets, unless the terms of any such series shall provide otherwise.

Section 10. Fractional Shares.

Series A Junior Participating Preferred Stock may be issued in fractions of a share which shall entitle the holder, in proportion to such holder's fractional shares, to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights of holders of Series A Junior Participating Preferred Stock."

IN WITNESS WHEREOF, we have executed and subscribed this Certificate and do affirm the foregoing as true under the penalties of perjury this ____th day of September, 2002.

                                       By
                                              ----------------------------------
                                       Name:  Herbert A. Trucksess III
                                       Title: Chairman, President and Chief
                                                Executive Officer

Attest

By:
        ----------------------------------
Name:   James J. Bellinghausen
Title:  Vice President and Chief Financial
          Officer

Exhibit B

[Form of Right Certificate]

Certificate No. R _______________ ____________ Rights

NOT EXERCISABLE AFTER THE EXPIRATION DATE. AT THE OPTION OF THE COMPANY, THE
RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER RIGHT OR EXCHANGE FOR COMMON
STOCK, UNDER THE CIRCUMSTANCES AND ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN
ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON AND ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS
REPRESENTED BY THIS RIGHT CERTIFICATE WERE ISSUED TO A PERSON WHO WAS AN
ACQUIRING PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON. THIS
RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY ARE VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.][*]

Right Certificate

SCS TRANSPORTATION, INC.

This certifies that_____________, or registered assigns, is the registered owner of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions and conditions of the Rights Agreement dated as of September 30, 2002 (the "Rights Agreement") between SCS Transportation, Inc., a Delaware corporation (the "Company"), and Mellon Investor Services LLC, a New Jersey limited liability company (the "Rights Agent"), to purchase from the Company at any time after the Distribution Date (as such term is defined in the Rights Agreement) and prior to 5:00 p.m. Kansas City, Missouri time on the Expiration Date, as that term is defined in the Rights Agreement, at the office designated for such purpose by the Rights Agent, or its successor as Rights Agent, one ten-thousandth of a fully paid, nonassessable share of the Series A Junior Participating Preferred Stock, par value $0.001 per share ("Preferred Stock"), of the Company, at a purchase price of $_____ per one ten-thousandth of a share (the "Purchase Price") upon presentation and surrender of this Right Certificate with the Form of Election to Purchase duly executed. The number of Rights evidenced by this Right Certificate (and the number of shares which may be purchased upon exercise of each Right) and the Purchase Price set forth above, are the number and Purchase Price as of __________ based on the shares of Preferred Stock of the Company as constituted at such date.

[* The portion of the legend in brackets shall be inserted only if applicable.]

The Purchase Price and the number of shares of Preferred Stock which may be purchased upon the exercise of each of the Rights evidenced by this Right Certificate are subject to modification and adjustment upon the happening of certain events as provided in the Rights Agreement.

This Right Certificate is subject to all of the terms, provisions and conditions of the Rights Agreement, which terms, provisions and conditions are hereby incorporated herein by reference and made a part hereof and to which Rights Agreement reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Right Certificates. Copies of the Rights Agreement are on file at the Company and the above-mentioned office of the Rights Agent and are also available upon written request to the Company.

This Right Certificate, with or without other Right Certificates, upon surrender at the stockholder services office (or such office designated for such purpose) of the Rights Agent, may be exchanged for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate number of shares of Preferred Stock as the Rights evidenced by the Right Certificate or Right Certificates surrendered shall have entitled such holder to purchase. If this Right Certificate shall be exercised in part, the holder shall be entitled to receive, upon surrender hereof, another Right Certificate or Right Certificates for the number of whole Rights not exercised.

Subject to the provisions of the Rights Agreement, the Rights evidenced by this Certificate may be redeemed by the Company at its option at a redemption price of $0.01 per Right on or prior to the Stock Acquisition Date (as defined in the Rights Agreement). In addition, subject to the provisions of the Rights Agreement, each Right evidenced by this Certificate may be exchanged by the Company at its option for one share of Common Stock following the Stock Acquisition Date and prior to the time an Acquiring Person, as that term is defined in the Rights Agreement, owns 50% or more of the Voting Power, as that term is defined in the Rights Agreement, of the Company.

No fractional shares of Preferred Stock will be issued upon the exercise of any Rights evidenced hereby (other than fractions which are integral multiples of one ten-thousandth of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depositary receipts). In lieu of fractions of a share, a cash payment will be made, as provided in the Rights Agreement.

No holder of this Right Certificate shall be entitled to vote or receive dividends or be deemed for any purpose the holder of shares of Preferred Stock or of any other securities of the Company which may at any time be issuable on the exercise hereof, nor shall anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as provided in the Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Rights evidenced by this Right Certificate shall have been exercised as provided in the Rights Agreement.

This Right Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent.

WITNESS the facsimile signature of the proper officers of the Company and its corporate seal.

Dated as of ________________.

Attest:                                 SCS TRANSPORTATION, INC.

By                                      By
       -----------------------------           ---------------------------------
Name:                                   Name:
       -----------------------------           ---------------------------------
Title:                                  Title:
       -----------------------------           ---------------------------------

Countersigned:

MELLON INVESTOR SERVICES LLC

By:
Authorized signature

[Form of Reverse Side of Right Certificate]

FORM OF ASSIGNMENT

(To be executed by the registered holder if such holder desires to transfer the Right Certificate.)

FOR VALUE RECEIVED_______________________________________________

hereby sells, assigns and transfers unto

(Please print name and address of transferee)

this Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint _____________ Attorney to transfer the within Right Certificate on the books of the within named Company, with full power of substitution.

Dated:

Signature

(Signature must conform in all respects to name of holder as specified on the face of this Right Certificate)

Signature Guaranteed:

Signatures must be guaranteed by a member or a participant in the Securities Transfer Agent Medallion Program, the New York Stock Exchange Medallion Signature Program or the Stock Exchange Medallion Program.

CERTIFICATE

The undersigned hereby certifies by checking the appropriate boxes that:

(1) this Right Certificate [ ] is [ ] is not being sold, assigned and transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights Agreement);

(2) after due inquiry and to the best knowledge of the undersigned, it [ ] did [ ] did not acquire the Rights evidenced by this Right Certificate from any Person who is, was or subsequently became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.

Dated:                             Signature
       ----------------                      ----------------------------------
                                             (Signature must conform in all
                                             respects to name of holder as
                                             specified on the face of this
                                             Right Certificate)

FORM OF ELECTION TO PURCHASE

(To be executed if holder desires to
exercise the Right Certificate.)

To SCS TRANSPORTATION, INC.:

The undersigned hereby irrevocably elects to exercise ______________ Rights represented by this Right Certificate to purchase the shares of Preferred Stock issuable upon the exercise of such Rights and requests that certificates for such shares be issued in the name of:

Name:

Address:

Social security or taxpayer identification number:

If such number of Rights shall not be all the Rights evidenced by this Right Certificate, a new Right Certificate for the balance remaining of such Rights shall be registered in the name of and delivered to:

Name:

Address:

Social security or taxpayer identification number:

Dated:

Signature

(Signature must conform in all respects to name of holder as specified on the face of this Right Certificate)

Signature Guaranteed:

CERTIFICATE

The undersigned hereby certifies by checking the appropriate boxes that:

(1) the Rights evidenced by this Right Certificate [ ] are [ ] are not being exercised by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights Agreement);

(2) this Rights Certificate [ ] is [ ] is not being sold, assigned and transferred by or on behalf of a Person who is or was an Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as such terms are defined pursuant to the Rights Agreement);

(3) after due inquiry and to the best knowledge of the undersigned, it [ ] did [ ] 0did not acquire the Rights evidenced by this Right Certificate from any Person who is, was or became an Acquiring Person or an Affiliate or Associate of an Acquiring Person.

Dated:

Signature

(Signature must conform in all respects to name of holder as specified on the face of this Right Certificate)

NOTICE

The signature in the foregoing Forms of Assignment and Election must conform to the name as written upon the face of this Right Certificate in every particular, without alteration or enlargement or any change whatsoever.

In the event the certification set forth above in the form of Assignment or the form of Election to Purchase, as the case may be, is not completed, the Company and the Rights Agent will deem the beneficial owner of the Rights evidenced by this Right Certificate to be an Acquiring Person or an Affiliate or Associate thereof (as defined in the Rights Agreement) and such Assignment or Election to Purchase will not be honored as described in Section 7(e) of the Rights Agreement.

Exhibit C

SCS TRANSPORTATION, INC.

SUMMARY OF PREFERRED STOCK
PURCHASE RIGHTS

On September 17, 2002, the Board of Directors of SCS Transportation, Inc. (the "Company") declared a dividend of one preferred share purchase right (a "Right") for each outstanding share of Common Stock, par value $0.001 per share, of the Company (the "Common Stock"). The dividend distribution is payable on September 30, 2002 (the "Record Date") to the stockholders of record at the close of business on that date. Each Right entitles the registered holder to purchase from the Company one ten-thousandth of a share of Series A Junior Participating Preferred Stock, par value $0.001 per share (the "Preferred Stock") of the Company at a price of $96 per one ten-thousandth of a share of Preferred Stock (the "Purchase Price"), subject to adjustment. The description and terms of the Rights are set forth in a Rights Agreement dated as of September 30, 2002, as the same may be amended from time to time (the "Rights Agreement"), between the Company and Mellon Investor Services LLC, as Rights Agent (the "Rights Agent").

Until the earlier to occur of (i) the close of business on the tenth business day following the date of public announcement or the date on which the Company first has notice or determines that a person or group of affiliated or associated persons (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company) (an "Acquiring Person") has acquired, or obtained the right to acquire, 15% or more of the outstanding shares of voting stock of the Company without the prior express written consent of the Company executed on behalf of the Company by a duly authorized officer of the Company following express approval by action of at least a majority of the members of the Board of Directors then in office (the "Stock Acquisition Date") or (ii) the close of business on the tenth business day (or such later date as may be determined by action of the Board of Directors but not later than the Stock Acquisition Date) following the commencement of a tender offer or exchange offer, without the prior written consent of the Company, by a person (other than the Company, any subsidiary of the Company or an employee benefit plan of the Company) which, upon consummation, would result in such party's control of 15% or more of the Company's voting stock (the earlier of the dates in clause (i) or
(ii) above being called the "Distribution Date"), the Rights will be evidenced, with respect to any of the Common Stock certificates outstanding as of the Record Date, by such Common Stock certificates.

The Rights Agreement provides that, until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferred with and only with the Company's Common Stock. Until the Distribution Date (or earlier redemption, exchange or expiration of the Rights), new Common Stock certificates issued after the Record Date upon transfer or new issuances of Common Stock will contain a notation incorporating the Rights Agreement by reference. Until the Distribution Date (or earlier redemption, exchange or expiration of the Rights), the surrender for transfer of any certificates for shares of Common Stock outstanding as of the Record Date, even without such notation or a copy of this Summary of Rights, will also constitute the transfer of the Rights associated with the Common Stock

represented by such certificate. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights ("Right Certificates") will be mailed to holders of record of the Common Stock as of the close of business on the Distribution Date and such separate certificates alone will then evidence the Rights.

The Rights are not exercisable until the Distribution Date. The Rights will expire, if not previously exercised, on September 30, 2012 (the "Final Expiration Date"), unless the Final Expiration Date is extended or unless the Rights are earlier redeemed or exchanged by the Company.

The Purchase Price payable, and the number of shares of Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of the Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of certain rights or warrants to subscribe for or purchase Preferred Stock at a price, or securities convertible into Preferred Stock with a conversion price, less than the then-current market price of the Preferred Stock or (iii) upon the distribution to holders of the Preferred Stock of evidences of indebtedness or assets (excluding regular periodic cash dividends or dividends payable in Preferred Stock) or of subscription rights or warrants (other than those referred to above).

The number of outstanding Rights and the number of one ten-thousandths of a share of Preferred Stock issuable upon exercise of each Right are also subject to adjustment in the event of a stock split of the Common Stock or a stock dividend on the Common Stock payable in shares of Common Stock or subdivisions, consolidations or combinations of the Common Stock occurring, in any such case, prior to the Distribution Date.

Shares of Preferred Stock purchasable upon exercise of the Rights will not be redeemable and junior to any other series of preferred stock the Company may issue (unless otherwise provided in the terms of such stock). Each share of Preferred Stock will have a preferential dividend in an amount equal to 10,000 times any dividend declared on each share of Common Stock. In the event of liquidation, the holders of the Preferred Stock will receive a preferred liquidation payment of equal to the greater of $10,000 and 10,000 times the payment made per share of Common Stock. Each share of Preferred Stock will have 10,000 votes, voting together with the Common Stock. In the event of any merger, consolidation or other transaction in which shares of Common Stock are converted or exchanged, each share of Preferred Stock will be entitled to receive 10,000 times the amount and type of consideration received per share of Common Stock. The rights of the Preferred Stock as to dividends, liquidation and voting, and in the event of mergers and consolidations, are protected by customary antidilution provisions.

Because of the nature of the Preferred Stock's dividend, liquidation and voting rights, the value of the one ten-thousandth interest in a share of Preferred Stock purchasable upon exercise of each Right should approximate the value of one share of Common Stock.

If any person or group (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company) acquires 15% or more of the Company's outstanding voting stock without the prior written consent of the Board of Directors, each Right, except those held by such persons, would entitle each holder of a Right to acquire such number

of shares of the Company's Common Stock as shall equal the result obtained by multiplying the then current Purchase Price by the number of one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable and dividing that product by 50% of the then current per share market price of Company Common Stock.

If any person or group (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company) acquires more than 15% but less than 50% of the outstanding Company Common Stock without prior written consent of the Board of Directors, each Right, except those held by such persons, may be exchanged by the Board of Directors for one share of Company Common Stock.

If the Company were acquired in a merger or other business combination transaction where the Company is not the surviving corporation or where Company Common Stock is exchanged or changed or 50% or more of the Company's assets or earnings power is sold in one or several transactions without the prior written consent of the Board of Directors, each Right would entitle the holders thereof (except for the Acquiring Person) to receive such number of shares of the acquiring company's common stock as shall be equal to the result obtained by multiplying the then current Purchase Price by the number one-ten-thousandths of a share of Preferred Stock for which a Right is then exercisable and dividing that product by 50% of the then current market price per share of the common stock of the acquiring company on the date of such merger or other business combination transaction.

With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price. No fractional shares of Preferred Stock will be issued (other than fractions which are integral multiples of one ten-thousandth of a share of Preferred Stock, which may, at the election of the Company, be evidenced by depositary receipts), and in lieu thereof an adjustment in cash will be made based on the market price of the Preferred Stock on the last trading day prior to the date of exercise.

At any time prior to the time an Acquiring Person becomes such, the Board of Directors of the Company may redeem the Rights in whole, but not in part, at a price of $0.01 per Right (the "Redemption Price"). The redemption of the Rights may be made effective at such time, on such basis and with such conditions as the Board of Directors in its sole discretion may establish. Immediately upon any redemption of the Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price.

The terms of the Rights may be amended by the Board of Directors of the Company without the consent of the holders of the Rights, including, but not limited to, an amendment to lower certain thresholds described above to not less than the greater of (i) any percentage greater than the largest percentage of the voting power of all securities of the Company then known to the Company to be beneficially owned by any person or group of affiliated or associated persons (other than an excepted person) and (ii) 10%, except that from and after such time as any person or group of affiliated or associated persons becomes an Acquiring Person no such amendment may adversely affect the interests of the holders of the Rights.

Until a Right is exercised, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends.

A copy of the Rights Agreement has been filed with the Securities and Exchange Commission as an Exhibit to a Registration Statement on Form 10 dated September 6, 2002. A copy of the Rights Agreement is available free of charge from the Company. This summary description of the Rights does not purport to be complete and is qualified in its entirety by reference to the Rights Agreement, as the same may be amended from time to time, which is hereby incorporated herein by reference.

EXECUTION COPY

EXHIBIT 10.3

MASTER SEPARATION AND DISTRIBUTION AGREEMENT

DATED AS OF SEPTEMBER 30, 2002

BETWEEN

YELLOW CORPORATION

AND

SCS TRANSPORTATION, INC.

TABLE OF CONTENTS

                                                                                       PAGE
                                                                                       ----

RECITALS..................................................................................1

                                    ARTICLE I

                              PLAN OF DISTRIBUTION

1.1     The Distribution..................................................................2
1.2     Conditions to Distribution........................................................2
1.3     Sale of Fractional Shares.........................................................4
1.4     Sole Discretion of Yellow.........................................................4
1.5     Termination of Obligations........................................................5

                                   ARTICLE II

                       DIVISION OF ASSETS AND LIABILITIES

2.1     Transfer of Assets and Liabilities................................................5
2.2     Allocated Employees...............................................................6
2.3     Stock Options and Restricted Stock................................................7
2.4     Third Party Debt..................................................................7
2.5     Certain Financial Support Arrangements............................................7
2.6     Miscellaneous Obligations and Claims.............................................13

                                   ARTICLE III

                         REPRESENTATIONS AND WARRANTIES

3.1     Representations and Warranties of Yellow.........................................15
3.2     Representations and Warranties of SCST...........................................16

                                   ARTICLE IV

                                 RELATED MATTERS

4.1     Access to Information............................................................17
4.2     Confidentiality..................................................................17
4.3     Indemnification..................................................................18
4.4     Manner of Payments...............................................................19

-i-

4.5     Taxes............................................................................19
4.6     Expenses.........................................................................19
4.7     Non-solicitation.................................................................19

                                    ARTICLE V

                               DISPUTE RESOLUTION

5.1     Use of Dispute Resolution; Presumptions..........................................20
5.2     Negotiation......................................................................20
5.3     Non-binding Mediation............................................................20
5.4     Proceedings......................................................................21
5.5     Continuity of Service and Performance............................................21
5.6     Further Assurances...............................................................21

                                   ARTICLE VI

                                  MISCELLANEOUS

6.1     Survival.........................................................................21
6.2     Entire Agreement.................................................................21
6.3     Waiver and Modification..........................................................21
6.4     Notices..........................................................................22
6.5     Counterparts.....................................................................22
6.6     Severability.....................................................................22
6.7     Assignment.......................................................................23
6.8     Choice of Law....................................................................23
6.9     No Third-Party Beneficiaries.....................................................23

                                   ARTICLE VII

                                  DEFINED TERMS

7.1     Defined Terms....................................................................23

-ii-

Table of Exhibits
-----------------

Exhibit A           Form of By-laws
Exhibit B           Form of Amended and Restated Certificate of Incorporation
Exhibit C           Form of Tax Sharing Agreement

-iii-

MASTER SEPARATION AND DISTRIBUTION AGREEMENT

This Master Separation and Distribution Agreement (this "Agreement") is made and entered into as of the 30th day of September, 2002 by and among Yellow Corporation, a Delaware corporation ("Yellow"), and SCS Transportation, Inc., a Delaware corporation and a wholly owned subsidiary of Yellow ("SCST"). Capitalized terms used herein and not otherwise defined shall have the meanings assigned to them in Article VII hereof.

RECITALS

A. WHEREAS, Yellow is the sole stockholder of SCST, and SCST is the sole stockholder of the operating subsidiaries Saia Motor Freight Line, Inc. ("Saia") and Jevic Transportation, Inc. ("Jevic");

B. WHEREAS, Yellow's Board of Directors has determined pursuant to an integrated plan to (i) separate SCST, which comprises Yellow's non-union, regional operations, from Yellow's other businesses and operations (the "Separation") and (ii) distribute to Yellow's stockholders on a tax-free basis all of the outstanding shares of SCST's common stock (the "Distribution");

C. WHEREAS, Yellow's Board of Directors has determined that it is in the best interests of its stockholders to consummate the Separation and the Distribution;

D. WHEREAS, it is appropriate and desirable to set forth the principal corporate transactions required to effect the Separation and the Distribution and certain other agreements that will govern certain matters relating to such transactions (collectively, the "Transactions") and the relationship of Yellow and SCST following the consummation of the Transactions;

NOW, THEREFORE, the parties, intending to be legally bound, agree as follows:

TERMS AND CONDITIONS

In consideration of the mutual covenants herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, it is hereby agreed as follows:

-2-

ARTICLE I

PLAN OF DISTRIBUTION

1.1 The Distribution.

(i) Subject to Section 1.2 hereof, Yellow and SCST shall take all reasonable steps necessary and appropriate to cause all conditions to the Distribution to be satisfied and to effect the Distribution. Yellow's Board of Directors will have the sole discretion to determine the Distribution Date, and Yellow will consummate the Distribution subject to the satisfaction or waiver by Yellow's Board of Directors, in its sole discretion, of the conditions set forth in Section 1.2.

(ii) On or prior to the Distribution Date, Yellow will deliver to the Distribution Agent for the benefit of the holders of record of Yellow Common Stock on the Record Date, stock certificates, endorsed by Yellow in blank, representing all of the outstanding shares of SCST Common Stock, and shall cause the transfer agent for the Yellow Common Stock to instruct the Distribution Agent to distribute on the Distribution Date the appropriate number of such shares of SCST Common Stock to each such holder or designated transferee or transferees of such holder.

(iii) Subject to Section 1.3 hereof, each holder of record of Yellow Common Stock (or such holder's designated transferee or transferees) on the Record Date will be entitled to receive in the Distribution that number of shares of SCST Common Stock equal to that number of shares of Yellow Common Stock owned by such holder on the Record Date divided by a number equal to the Distribution Ratio established by Yellow's Board of Directors.

1.2 Conditions to Distribution.

1.2.1  The obligations of each party hereto to consummate the
       Distribution are subject to the satisfaction or waiver by
       Yellow in its sole discretion of each of the following
       conditions:

        (i)   the simultaneous execution, delivery and

performance as required of each of the following:

(a) this Agreement;

(b) the Tax Sharing Agreement;

-3-

(c) (1) the execution by SCST on or before the Distribution Date of those certain Debt Agreements listed in paragraph 1.2.1 of the disclosure letter from Yellow to SCST dated the date hereof (the "Disclosure Letter"), each in form, substance and amount satisfactory to Yellow, and (2) on or before the Distribution Date, the payment by SCST to Yellow of a cash dividend or a repayment by SCST to Yellow of intercompany indebtedness (or a combination of any of the foregoing) from the proceeds of such Debt Agreements, in the approximate amount of $110.7 million, subject to adjustment on a post-closing basis in the manner set forth in paragraph 1.2.1(i)(c) of the Disclosure Letter (the "Yellow Payment");

(ii) the Registration Statement shall have been filed and declared effective by the Commission, and there shall be no stop order in effect with respect thereto, and no proceeding for that purpose shall have been instituted or threatened by the Commission;

(iii) the actions and filings with regard to state securities and blue sky laws of the United States (and any comparable laws under any foreign jurisdictions) shall have been taken and, where applicable, have become effective or been accepted;

(iv) the SCST Common Stock to be distributed in the Distribution shall have been admitted for trading on The Nasdaq National Market, on official notice of distribution;

(v) no order, injunction or decree issued by any Government Authority or other legal restraint or prohibition preventing the consummation of the Distribution or any of the other transactions contemplated by this Agreement or the Tax Sharing Agreement shall be threatened, pending or in effect;

(vi) the Letter Ruling shall have been issued and shall not have been revoked;

(vii) any material Consents and Governmental Approvals necessary to consummate the Distribution shall have been obtained and be in full force and effect;

-4-

(viii) Yellow's Board of Directors shall be satisfied that the Distribution will be made out of surplus within the meaning of Section 170 of the Delaware General Corporation Law;

(ix) Yellow's Board of Directors shall have approved the Separation and the Distribution and shall not have abandoned or deferred the Distribution at any time prior to the Record Date;

(x) Yellow's Board of Directors shall be satisfied that the Distribution does not constitute the conveyance of all or substantially all of the properties or assets of Yellow immediately prior to the Distribution, as contemplated in Section 271 of the Delaware General Corporation Law;

(xi) the Certificate of Incorporation and By-laws shall be in effect;

(xii) no other events or developments shall have occurred that, in the sole judgment of Yellow, would result in the Distribution having a material adverse effect on Yellow or its stockholders;

(xiii) Yellow's Board of Directors shall be satisfied that each of Yellow and SCST will be solvent following the Distribution; and

(xiv) SCST shall have made the Yellow Payment.

1.3 Sale of Fractional Shares. The Distribution Agent shall not distribute any fractional shares of SCST Common Stock ("Fractional Shares") to any record holder of Yellow Common Stock in connection with the Distribution. The Distribution Agent shall be instructed to aggregate all such Fractional Shares and sell them in an orderly manner promptly after the Distribution Date in the open market at the then-prevailing prices and, after completion of all such sales, distribute a pro rata portion of the gross proceeds from such sales, less appropriate deductions of the amount required to be withheld for federal income tax purposes, to each record holder of Yellow Common Stock who would otherwise have received a Fractional Share. Yellow shall pay all brokerage charges, commissions and transfer taxes attributed to such sale.

1.4 Sole Discretion of Yellow. The conditions set forth in Section 1.2 are for the sole benefit of Yellow and shall not give rise to or create any duty on the part of Yellow or Yellow's Board of Directors to waive or not to waive such conditions or limit in any way Yellow's right to terminate this Agreement or alter the consequences of any such termination. Any determination made by Yellow prior to the Distribution concerning the satisfaction or waiver of any or all of the conditions set forth in Section 1.2 shall be conclusive. In addition,

-5-

Yellow shall have the sole and absolute discretion to determine the date of consummation of the Distribution (such date, the "Distribution Date"), all terms of the Distribution, including without limitation the form, structure and terms of any transaction(s) and/or offering(s) to effect the Distribution or related to the Distribution and the timing of and conditions to the consummation of the Distribution. In addition, Yellow may in its sole and absolute discretion at any time and from time to time until the Distribution Date, modify or change the terms of the Distribution, including without limitation accelerating or delaying the timing of the consummation of all or part of the Distribution. SCST shall cooperate with Yellow in all respects to accomplish the Distribution and shall, at Yellow's direction, promptly take any and all actions necessary and desirable to effect the Distribution, including without limitation the registration under the Exchange Act of the SCST Common Stock on an appropriate registration form. Yellow shall in its sole and absolute discretion select any investment bank and managers in connection with the Distribution, as well as any financial printer, solicitation and/or exchange agent and its own outside counsel.

1.5 Termination of Obligations. The obligations of Yellow and SCST under this Agreement shall terminate on a determination by Yellow to terminate the transactions that comprise the Distribution.

ARTICLE II

DIVISION OF ASSETS AND LIABILITIES

2.1 Transfer of Assets and Liabilities.

(a) On the terms and subject to the conditions set forth in this Agreement and with effect as of the Contribution Date, Yellow hereby contributes, assigns, transfers, conveys and delivers to SCST, and shall cause its applicable Subsidiaries to contribute, assign, transfer, convey and deliver to SCST or a member of the SCST Group, all of Yellow's and such applicable Subsidiaries' respective rights, title and interest in and to the assets set forth in paragraph 2.1 of the Disclosure Letter (the "Contributed Assets"). SCST, or the appropriate member of the SCST Group, hereby accepts from Yellow and its Subsidiaries the Contributed Assets.

(b) On the terms and subject to the conditions set forth in this Agreement and with effect as of the Contribution Date, SCST hereby accepts, assumes and agrees faithfully to perform, discharge and fulfill all the liabilities set forth in paragraph 2.1 of the Disclosure Letter (the "Contributed Liabilities") in accordance with their respective terms, and agrees to cause its applicable Subsidiaries to accept, assume, perform, discharge and fulfill all the Contributed Liabilities to be held by its Subsidiaries in accordance with their respective terms. SCST shall thereafter be responsible for all Contributed Liabilities, regardless of

-6-

(i) when or where such liabilities arose or arise, (ii) whether the facts on which they are based occurred prior to or subsequent to the date hereof, (iii) where or against whom such liabilities are asserted or determined (including without limitation any liabilities arising out of claims made by Yellow's or SCST's respective directors, officers, employees, agents, Subsidiaries or Affiliates against any member of the Yellow Group or the SCST Group), (iv) whether such liabilities were asserted or determined prior to the date hereof, and (v) whether such liabilities arise from or are alleged to arise from negligence, recklessness, violation of law, fraud or misrepresentation by any member of the Yellow Group or the SCST Group or any of their respective directors, officers, employees, agents, Subsidiaries or Affiliates.

(c) In the event that at any time or from time to time (whether prior to or after the Contribution Date), any party hereto (or any member of such party's respective Group) shall receive or otherwise possess any asset that is allocated to any other Person pursuant to this Agreement, such party shall promptly transfer, or cause to be transferred, such asset to the Person so entitled thereto. Prior to any such transfer, the party possessing such asset shall hold such asset in trust for any such other party, and upon such transfer each party shall reimburse the other or make financial or other adjustments to remedy any liabilities resulting from such transfer or possession.

2.2 Allocated Employees. As of the Distribution, the employees of Yellow listed in paragraph 2.2 of the Disclosure Letter shall become employees of SCST (the "Allocated Employees"). Yellow shall not be responsible for insurance, employee benefits and other related benefits of the Allocated Employees that accrue from and after the Distribution Date except as may be provided in an individual agreement between Yellow and any Allocated Employee. SCST shall be responsible for all costs associated with the Allocated Employees from and after the Distribution Date. Yellow shall not be responsible for any Cobra benefit, or unemployment or workers' compensation benefit of an employee whose employment ends or whose injury or death occurs while an employee of SCST. SCST shall reimburse Yellow in accordance with the procedures set forth in Section 4.4 if Yellow determines that it has made any direct or indirect payment in respect thereof, including without limitation as a result of adjustment to its insurance rates or government fund payment obligations. SCST's health and life insurance plans will not exclude pre-existing conditions for the Allocated Employees (except to the extent such pre-existing conditions were excluded from the corresponding Yellow plan immediately prior to the Distribution Date), will waive any waiting period requirements for the Allocated Employees, and will waive any evidence of insurability provisions for the Allocated Employees. In addition, SCST's health plans will apply toward any deductible requirements and out-of-pocket maximum limits for the plan year in which the Distribution takes place any amounts paid by an Allocated Employee toward such requirements and limits under the Yellow health plan in which he or she participated during such plan year. SCST shall, and shall cause its Subsidiaries to, grant the Allocated Employees credit for their service

-7-

with Yellow and its Subsidiaries prior to the Distribution Date for purposes of eligibility to participate in and vesting in the benefit plans sponsored by SCST and its Subsidiaries.

2.3 Stock Options and Restricted Stock. The outstanding stock options held by Yellow's directors, employees and other parties, including Allocated Employees, to purchase stock of Yellow shall be adjusted in the manner set forth in paragraph 2.3 of the Disclosure Letter. Certain senior officers of Yellow and its Subsidiaries Yellow Transportation, Meridian IQ and Yellow Technologies have received restricted stock grants. All such senior officers who are actively employed by Yellow or any such Subsidiary on the Distribution Date will agree to waive the shares of SCST Common Stock that they would otherwise have received in exchange for additional restricted shares of Yellow Common Stock commensurate in value to the impact of the Distribution on the value of their previous restricted stock grants. The additional grants of restricted stock will be subject to the same restrictions and vesting dates as the original grants.

2.4 Third Party Debt. SCST and/or its subsidiaries shall make all future interest and principal payments on and after the Distribution Date on all Third Party Debt in addition to the Debt Agreements listed in paragraph 1.2.1 of the Disclosure Letter which resides on the books of SCST or its subsidiaries as of the Distribution Date, and SCST shall indemnify and hold Yellow harmless for payment of interest or principal after the Distribution Date in accordance with
Section 4.3. Third Party Debt is listed in paragraph 2.4 of the Disclosure Letter.

2.5 Certain Financial Support Arrangements.

2.5.1     Guarantees by Yellow of SCST Obligations. As of the date
          hereof, Yellow has provided guarantees of certain
          obligations of SCST and its subsidiaries, the holders,
          amount and duration of which are set forth in paragraph
          2.5.1 of the Disclosure Letter (the "Guarantees"). As of
          the Distribution Date, Yellow shall cancel all Guarantees
          which it is permitted to cancel without the consent of any
          other person in accordance with the documentation
          governing such Guarantee. With respect to any Guarantees
          the cancellation of which requires the consent of a third
          party, SCST shall, subject to the following sentence, use
          its reasonable best efforts following the Distribution
          Date to remove such Guarantee by Yellow of obligations of
          SCST and its Subsidiaries, and SCST shall indemnify and
          hold Yellow harmless from any damages, claims, monies or
          other demands incurred by or asserted against Yellow which
          arise out of, in connection with or with reference to any
          Guarantee in accordance with Section 4.3. SCST shall not
          be required to offer monetary compensation to any holder
          of a Guarantee to secure its release. Yel-

-8-

          low will not extend any Guarantee beyond the end of the
          term of each obligation as in effect on the date hereof.

2.5.2     Insurance, Collateral and Claims Administration
          Obligations.

          2.5.2.1  Insurance. Responsibility as between SCST and
                   Yellow for any self-insurance, retention,
                   deductible, retrospective premium, or similar
                   items, including without limitation associated
                   administrative expenses and allocated loss
                   adjustment or similar expenses, arising after the
                   Distribution Date under any and all former or
                   current insurance policies maintained by Yellow
                   and related to liabilities or losses of SCST or
                   its Subsidiaries prior to the Distribution Date
                   shall be allocated by Yellow to SCST or Yellow
                   (each of the foregoing being a "party") on a
                   basis not inconsistent with past practices
                   between Yellow and SCST. To the extent that any
                   party pays any expenses that were determined by
                   Yellow to be properly allocable to the other
                   party, such other party shall reimburse the
                   paying party in accordance with the procedures
                   set forth in Section 4.4.

          2.5.2.2  Self-Insurance Pool and AIT "Bank". As of the
                   Distribution Date, a calculation shall be made by
                   Yellow of the total of all premiums paid since
                   inception by SCST and its Subsidiaries for
                   coverage under the self-insurance retention pool
                   which has been maintained by Yellow to buy down
                   the self-insurance retentions of Jevic and Saia
                   (and Action Express, Inc. and WestEx, Inc.,
                   merged into Saia effective March 4, 2001) from
                   external retention levels of third-party
                   insurance providers. To this amount there shall
                   be added $1,014,783.00, representing SCST's and
                   its Subsidiaries' shares of the "bank" that has
                   been established with AI Transport, Inc. of
                   Atlanta, Georgia ("AIT") relating to certain
                   third-party liability claims incurred by Yellow
                   and SCST's Subsidiaries over the course of
                   Yellow's insurance arrangements with AIT. All
                   payments made by AIT to Yellow prior to or after
                   the Distribution Date shall be retained solely by
                   Yellow.

                   From the total derived in the preceding
                   paragraph, there shall be subtracted a sum equal
                   to a calculation made by Yellow of the actual
                   claim payments made by Yellow to resolve claims
                   involving SCST and its Subsidiaries within the
                   self-insurance

                          -9-


                   retention pool from its inception to the
                   Distribution Date (the sum derived from this
                   calculation hereinafter being referred to as the
                   "Net Ultimate Liability of Yellow" and the
                   calculation being detailed in paragraph 2.5.2.2
                   of the Disclosure Letter).

                   After the Distribution Date, claims determined by
                   Yellow to fall within the self-insurance pool
                   that arise out of, in connection with or with
                   reference to activity of SCST and its
                   Subsidiaries prior to the Distribution Date
                   (together the "SCST Excess Liability") shall be
                   paid first by Yellow after the Distribution Date
                   up to the Net Ultimate Liability of Yellow. If
                   and when said Net Ultimate Liability of Yellow is
                   exhausted, all remaining liability for SCST
                   Excess Liability shall be paid by SCST and its
                   Subsidiaries, and SCST shall indemnify Yellow for
                   any claims asserted against Yellow for amounts of
                   SCST Excess Liability in excess of the Net
                   Ultimate Liability of Yellow in accordance with
                   Section 4.3. SCST shall reimburse Yellow in
                   accordance with the procedures set forth in
                   Section 4.4 if Yellow determines that Yellow or
                   any of its Subsidiaries has made any direct or
                   indirect payment in respect of SCST Excess
                   Liability in excess of the Net Ultimate Liability
                   of Yellow.

          2.5.2.3  Collateral. In order to cover certain Collateral
                   Requirements (as defined below) of SCST and its
                   Subsidiaries, Yellow has provided letters of
                   credit, indemnity bonds or other collateral to
                   secure certain obligations of SCST and its
                   subsidiaries for self-insurance retention
                   deductibles, retrospective premiums and cash
                   payment for reserves as set forth in paragraph
                   2.5.2.3 of the Disclosure Letter. With respect to
                   discussion of this issue, the following
                   definitions apply:

                   (i)    "Collateral" - Letters of credit,
                          indemnity bonds, or any other form of
                          collateral or guaranty which Yellow has or
                          will provide to cover certain collateral
                          requirements of SCST and its Subsidiaries
                          following the Distribution.

                   (ii)   "Collateral Requirements" - The collateral
                          required by SCST's current or former
                          insurance carriers, sureties, and all
                          states where SCST is currently or has been
                          self-insured for workers' compensation
                          purposes for policy

-10-

periods up to and including the March 1,
2002 - February 28, 2003 policy period.

(iii) "Collateral Cost" -

(1) Collateral Cost for any fiscal quarter ending on or prior to the second anniversary of the Distribution Date shall equal the sum of the cost billed by third parties to Yellow and its Subsidiaries in connection with providing Collateral as determined by Yellow (such billings in any fiscal quarter, the "Billed Cost").

(2) Collateral Cost for any fiscal quarter ending after the second anniversary of the Distribution Date and on or prior to the fourth anniversary of the Distribution Date shall equal the sum of
(a) the Billed Cost for such fiscal quarter plus (b) 25 basis points multiplied by the average daily face amount of the Collateral for such fiscal quarter as determined by Yellow.

(3) Collateral Cost for any fiscal quarter ending after the fourth anniversary of the Distribution Date and on or prior to the fifth anniversary of the Distribution Date shall equal the sum of
(a) the Billed Cost for such fiscal quarter plus (b) 50 basis points multiplied by the average daily face amount of the Collateral for such fiscal quarter as determined by Yellow.

(4) Collateral Cost for any fiscal quarter ending after the fifth anniversary of the Distribution Date and on or prior to the sixth anniversary of the Distribution Date shall equal the sum of
(a) the Billed Cost for such fiscal quarter plus (b) 75 basis points multiplied by the average daily face amount of the Collateral for such fiscal quarter as determined by Yellow.

(5) Collateral Cost for any fiscal quarter ending after the sixth anniversary of the Distribution Date and

-11-

on or prior to the seventh anniversary
of the Distribution Date shall equal the
sum of (a) the Billed Cost for such
fiscal quarter plus (b) 100 basis points
multiplied by the average daily face
amount of the Collateral for such fiscal
quarter as determined by Yellow.

(6) Collateral Cost for any fiscal quarter ending after the seventh anniversary of the Distribution Date shall equal the sum of (a) the Billed Cost for such fiscal quarter plus (b) 125 basis points multiplied by the average daily face amount of the Collateral for such fiscal quarter as determined by Yellow.

The Collateral Cost shall be billed on a quarterly basis in arrears following the Distribution Date. If Yellow receives a refund from collateral providers for the Billed Cost of Collateral that SCST has replaced following Yellow's payment of the annual cost of such Collateral, Yellow shall reimburse SCST the amount of such Billed Cost and related premium paid by SCST or any of its Subsidiaries to Yellow or any of its Subsidiaries within 15 calendar days of receipt by Yellow of such refund. Payment of the Collateral Cost by SCST shall be due within 15 calendar days after receipt by SCST of the applicable Yellow bill or invoice.

After the Distribution, Yellow shall leave existing Collateral in place until such Collateral has been released by its holders, except that SCST immediately after the Distribution shall replace $15 million of the existing Collateral detailed in paragraph 2.5.2.3 of the Disclosure Letter with Collateral obtained by SCST. Notwithstanding the foregoing, in the event that SCST experiences demands for increased Collateral from any of the holders of such Collateral detailed in paragraph 2.5.2.3 of the Disclosure Letter between the Distribution Date and February 28, 2003, Yellow shall either provide such increased Collateral or instruct SCST to provide such increased Collateral with a credit against SCST's replacement Collateral obligation described above, at Yellow's option.

-12-

         Yellow shall provide no additional Collateral to
         SCST or any of SCST's Subsidiaries for any
         insurance or self-insurance obligations arising
         after February 28, 2003.

         Notwithstanding the foregoing, in the event that
         any holder of any Collateral provided by Yellow
         redeems or calls such Collateral, SCST shall be
         required to reimburse Yellow in accordance with
         the procedures set forth in Section 4.4 and to
         indemnify and hold Yellow harmless in accordance
         with Section 4.3.

2.5.2.4  Claims Administration Obligations. Yellow and
         SCST acknowledge that Yellow currently receives
         invoices for claims administration expenses
         provided by third-party administrators ("TPAs")
         that pertain in whole or in part to the handling
         and disposition of claims on behalf of Saia under
         SCST's and Saia's insurance programs for years
         prior to the year ended March 1, 2000. Yellow
         shall continue to pay such invoices by TPAs after
         the Distribution Date and SCST and Saia shall be
         jointly or severally obligated to reimburse
         Yellow for the portion of such invoices which
         relate to services performed by TPAs on behalf of
         Saia. Yellow shall not pay the portion of any
         such invoices as relate to services performed on
         behalf of Saia until SCST and/or Saia has
         verified in writing the correctness of the
         billing, which SCST or Saia must do within
         fifteen (15) calendar days of presentment of the
         invoice by Yellow to SCST. If SCST or Saia does
         not deliver such written verification on or prior
         to the date that is fifteen (15) calendar days
         after the presentment of such invoice, Yellow
         shall regard SCST as having verified such
         invoice. Yellow will use its reasonable efforts
         to contest any such billing on Saia's behalf, and
         the parties will provide all reasonable
         cooperation required to resolve any billing
         disputes. If Yellow and SCST decide not to pay a
         disputed invoice or to pay only a portion
         thereof, SCST will indemnify Yellow from any
         damages or costs incurred by Yellow stemming from
         such non-payment or partial payment in accordance
         with Section 4.3. SCST or Saia, as the case may
         be, shall reimburse Yellow within fifteen (15)
         calendar days of Yellow's payment of that portion
         of each TPA invoice that relates to performance
         by TPAs of services on their behalf.

-13-

2.6 Miscellaneous Obligations and Claims. Certain miscellaneous obligations of Yellow and potential claims against third parties exist which shall be divided between Yellow and SCST as follows:

2.6.1     Preston Trucking Company, Inc. Claims. Yellow has incurred
          certain expenses and has filed a claim in bankruptcy to
          recover such expenses stemming from the bankruptcy of its
          former subsidiary Preston Trucking Company, Inc.
          ("Preston"). Any and all expenses incurred stemming from
          the bankruptcy of Preston, whether already incurred or to
          be incurred in the future, shall be the sole
          responsibility of Yellow, and Yellow shall be the sole
          beneficiary of any payment of the claim in bankruptcy that
          has been filed by Yellow against Preston, either for
          amounts already claimed or to be claimed in the future,
          specifically including any payment or valuation of the
          Warrant dated July 15, 1998, to purchase shares of
          Preston, that is presently held by Yellow. Following the
          Distribution Date, Yellow shall indemnify and hold SCST
          harmless in accordance with Section 4.3 for claims which
          in any manner relate to or stem from the bankruptcy of
          Preston and the former ownership of Preston by Yellow.

2.6.2     Luciano Transport Litigation. SCST's Subsidiary Saia is
          presently engaged in litigation against Luciano Transport,
          Inc. ("Luciano") and its owner Luis Saia, III relating to
          unpaid interline receivables that are owed by Luciano to
          Saia. SCST and/or Saia shall be solely responsible for the
          future prosecution of any claim against Luciano and/or
          Luis Saia, III for these unpaid interline receivables
          after the Distribution and SCST and/or Saia shall be the
          recipients of any and all judgment, settlement or other
          recovery ultimately achieved as a result of or in
          connection with such litigation against Luciano and Luis
          Saia, III, after the payment to Yellow of all expenses,
          including without limitation attorneys' fees up to a
          maximum of $25,000, that Yellow determines that it or any
          of its Subsidiaries (other than SCST or Saia) has incurred
          in the prosecution of this claim prior to the Distribution
          (together, the "Yellow Luciano Litigation Expenses").
          Amounts received by SCST or Saia as a result of or in
          connection with such litigation shall be paid first to
          Yellow in full satisfaction of the Yellow Luciano
          Litigation Expenses, promptly upon receipt thereof by any
          member of the SCST Group, and then to SCST or another
          member of the SCST Group.

2.6.3     Benesight Litigation. Saia is presently engaged in
          litigation against Benesight, Inc. ("Benesight") for
          services previously provided by Bene-

-14-

       sight as the TPA of Saia's medical plan. SCST and Saia
       shall solely be responsible for the future prosecution of
       any claim against Benesight and SCST and Saia shall be the
       recipients of any and all judgment, settlement or other
       recovery ultimately achieved as a result of such
       litigation against Benesight, after the payment to Yellow
       of all expenses, including without limitation attorneys'
       fees up to a maximum of $20,000, that Yellow determines
       that it or any of its Subsidiaries (other than SCST or
       Saia) has incurred in the prosecution of this claim prior
       to the Distribution (together, the "Yellow Benesight
       Litigation Expenses"). Amounts received by SCST or Saia as
       a result of or in connection with such litigation shall be
       paid first to Yellow in full satisfaction of the Yellow
       Benesight Litigation Expenses, promptly upon receipt
       thereof by any member of the SCST Group, and then to SCST
       or another member of the SCST Group.

2.6.4  Remaining Action Express Purchase Obligations. Pursuant to
       the Purchase Agreement entered into between Dan and David
       Fulkerson and Yellow for the issued and outstanding shares
       of Action Express, Inc. (merged into Saia effective March
       4, 2001) on November 3, 1998, future sums are due both Dan
       and David Fulkerson in the form of payments under the
       terms of their non-compete agreements through January 31,
       2006 and January 31, 2005, respectively. The
       responsibility for all such payments after the
       Distribution shall rest with SCST and/or Saia, and SCST
       shall indemnify and hold Yellow harmless for all damages,
       payments, costs and expenses incurred by Yellow after the
       Distribution Date which relate in any manner to the Action
       Express acquisition or claims for damages from the prior
       owners of Action Express allegedly arising out of said
       acquisition in accordance with Section 4.3.

2.6.5  Jevic Executive Employment and Severance Agreements. In
       connection with the acquisition by Yellow of Jevic on July
       9, 1999, Yellow and Jevic entered into employment
       agreements (the "Jevic Employment Agreements") with
       certain senior officers of Jevic, which employment
       agreements incorporated by reference severance agreements
       previously entered into between said senior officers and
       Jevic. The responsibility for any payments under the Jevic
       Employment Agreements after the Distribution Date shall
       rest with SCST and Jevic, and SCST shall indemnify and
       hold Yellow harmless for all damages, payments, costs and
       expenses incurred by Yellow after the Distribution Date
       which relate in any manner to claims for damages or
       payments under the Jevic Employment Agreements in
       accordance with Section 4.3.

-15-

2.6.6     Assignment of Rights. Yellow hereby assigns to SCST any
          rights or claims which Yellow has or may have against any
          third parties which arise out of the acquisition by Yellow
          of Jevic, Smalley Transportation Company, Johnson Freight
          Lines, Inc., and Action Express, Inc., together with any
          rights or claims arising at any time after any such
          acquisition.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

3.1 Representations and Warranties of Yellow. Yellow represents and warrants to SCST as follows:

(a) Organization and Standing. Yellow is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware.

(b) Authority and Status. Yellow has full power and authority to execute and deliver this Agreement and the Tax Sharing Agreement, to perform its obligations hereunder and under the Tax Sharing Agreement, and to consummate the transactions contemplated hereby and under the Tax Sharing Agreement without the necessity of any act or consent of any other person. Yellow has taken all necessary and appropriate corporate action, including obtaining all necessary board consents, with respect to the execution, delivery and performance of this Agreement and the Tax Sharing Agreement. This Agreement and the Tax Sharing Agreement to be executed, delivered and performed by Yellow in connection herewith constitute or will, when executed and delivered, constitute the valid and legally binding obligations of Yellow, enforceable against it in accordance with their respective terms, except as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws from time to time affecting the enforcement of creditors' rights generally.

(c) Litigation. To the knowledge of Yellow, there is no claim, litigation, action, suit or proceeding, administrative or judicial, pending or threatened against Yellow or related to the business or the assets transferred pursuant to this Agreement or the transactions contemplated hereunder, at law or in equity, before any federal, state, local or foreign court or regulatory agency, or other governmental authority, which could result

-16-

in the institution of legal proceedings to prohibit or restrain the consummation or performance of this Agreement or the transactions contemplated hereby, or claim damages as a result of this Agreement or the transactions contemplated hereby.

(d) No Conflict. Neither the execution and delivery of this Agreement and the Tax Sharing Agreement nor compliance with the terms and provisions hereof and thereof, including, without limitation, the consummation of the transactions contemplated hereby and thereby, will conflict with or result in the breach of any term, condition or provisions of Yellow's Certificate of Incorporation or By-laws or applicable law, regulation or court order.

3.2 Representations and Warranties of SCST. SCST represents and warrants to Yellow as follows:

(a) Organization and Standing. SCST is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware.

(b) Authority and Status. SCST has full power and authority to execute and deliver this Agreement and the Tax Sharing Agreement, to perform its obligations hereunder and thereunder and consummate the transactions contemplated hereby and thereby without the necessity of any act or consent of any other person. SCST has taken all necessary and appropriate corporate action, including obtaining all necessary board and shareholder consents with respect to the execution, delivery and performance by SCST of this Agreement and of the Tax Sharing Agreement. This Agreement and the Tax Sharing Agreement constitute or will when executed and delivered constitute the valid and legally binding obligation of SCST enforceable against it in accordance with their respective terms, except as enforceability may be limited by applicable equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws from time to time affecting the enforcement of creditors' rights generally.

(c) No Conflict. Neither the execution and delivery of this Agreement and the Tax Sharing Agreement nor the terms and provisions hereof and thereof including, without limitation, the consummation of the transactions contemplated hereby and thereby will conflict with or result in the breach of any term, condition or provisions of the Certificate of Incorporation or By-laws, as amended and restated, or applicable law, regulation or court order.

-17-

ARTICLE IV

RELATED MATTERS

4.1 Access to Information.

(a) From and after the Distribution Date, each of Yellow and SCST, on behalf of its respective Group, agrees to provide or cause to be provided to the other Group any Information in the possession or under the control of such Group which the requesting party reasonably needs

(i) to comply with reporting, disclosure, filing or other requirements imposed on the requesting party (including under applicable securities laws) by a Governmental Authority having jurisdiction over the requesting party;

(ii) for use in any other judicial, regulatory, administrative or other proceeding or in order to satisfy audit, accounting, claims, regulatory, litigation or other similar requirements, in each case other than claims or allegations that one party to this Agreement has against the other; or

(iii) subject to the foregoing clause (ii), to comply with its obligations under this Agreement or the Tax Sharing Agreement;

provided, however, that in the event that any party hereto determines that any such provision of Information could be commercially detrimental, violate any law or agreement, or waive any attorney-client privilege, the parties shall take all reasonable measures to permit the compliance with such obligations in a manner that avoids any such harm or consequence.

(b) Except as otherwise specifically provided for herein, a party providing Information or witnesses to the other hereunder shall be entitled to receive from the recipient, upon the presentation of appropriate invoices therefor, payments for such amounts relating to supplies, out-of-pocket expenses, and such other costs, employee time and disbursements, which may be reasonably incurred in providing such Information or witnesses. Invoices shall be due and payable within fifteen (15) calendar days of receipt. Employee time shall be billed at the involved employee's hourly rate for hourly employees with a four-hour minimum, and salary calculated on a per diem basis for salaried employees with a one calendar day minimum.

4.2 Confidentiality. Each of Yellow and its Subsidiaries (other than SCST and its Subsidiaries) and SCST and its Subsidiaries shall hold and cause each of their respective officers, directors, employees, agents, consultants and advisors to hold, in strict confidence, all non-public information concerning the other party, unless compelled to disclose such informa-

-18-

tion by judicial or administrative process or, in the opinion of counsel, by the requirements of law (in which case such party shall promptly notify the other party so that the other party may seek a protective order or other appropriate remedy). Each party shall not release or disclose such information to any other person except its auditors, attorneys, financial advisors, bankers, subcontractors and other consultants and advisors who have a need to know, who shall be bound by the provisions of this Section 4.2. Each party shall be deemed to have satisfied its obligations hereunder with respect to confidential information supplied by the other party if it exercises the same care as it does to preserving the confidentiality of its own similar information.

4.3 Indemnification.

(a) Except as otherwise provided in this Agreement, Yellow shall indemnify SCST, its Subsidiaries and their officers, directors, managers, members, employees, agents, affiliates and advisors (collectively, the "SCST Indemnitees") from and against and shall reimburse such SCST Indemnitees in respect of any and all Losses resulting from or arising out of (i) any Yellow Liabilities (whether arising prior to or after the Distribution Date), (ii) the failure of Yellow to perform any of its obligations under this Agreement in any material respect, and (iii) all Liabilities arising out of the business, operations and assets of Yellow and Yellow's Subsidiaries after the Distribution Date.

(b) Except as otherwise provided in this Agreement, SCST shall indemnify Yellow, its Subsidiaries and their officers, directors, managers, members, employees, agents, affiliates and advisors (collectively, the "Yellow Indemnitees") from and against and shall reimburse such Yellow Indemnitees in respect of any and all Losses resulting from or arising out of (i) any of the SCST Liabilities (whether arising prior to or after the Distribution Date), (ii) the failure of SCST to perform any of its obligations under this Agreement in any material respect, and (iii) all Liabilities arising out of the business, operations and assets of SCST and SCST's Subsidiaries after the Distribution Date.

(c) Any Liabilities not allocated to Yellow or its Subsidiaries or to SCST or its Subsidiaries hereunder shall be allocated to either Yellow or SCST by the Chief Executive Officer of Yellow in his sole discretion.

(d) Neither party shall be liable for indemnification with respect to any claim for which indemnification may result hereunder unless the party seeking indemnification (the "Indemnitee") notifies the other party (the "Indemnifying Party") in writing of the nature of the claim in as much detail as is feasible within a reasonable time after the facts giving rise to such claim are known to the Indemnitee. The Indemnifying Party shall be entitled to participate at its own expense in the defense or, if it so elects by a writing delivered to the Indemnitee within thirty (30) calendar days after receipt of such notice, to assume at its own expense the defense of the matter giving rise to the claim for indemnification or of any suit

-19-

brought in connection with it. If the Indemnifying Party elects to assume a defense and is reasonably creditworthy or carries insurance so as to make it reasonable to expect it will be able to discharge an adverse judgment, the defense shall be conducted by counsel chosen by it. Only one counsel will be provided for the Indemnitee in any one proceeding regardless of the number of entities or individuals to be indemnified and the Indemnifying Party shall be able to settle if it obtains an unconditional release without limitations on future conduct. If the Indemnitee elects to assume the defense of any such claim or suit and retains such counsel, the Indemnitee shall bear the fees and expenses of its own counsel arising out of any legal service thereafter performed by that counsel. In the event the Indemnitee elects to defend against any such claim it will, so long as the Indemnifying Party is actively engaged in defense of the claim, refrain from paying or compromising the claim and will extend its cooperation and assistance to the Indemnifying Party in its defense against the claim. If the parties hereto or an Indemnitee is unable to agree upon or settle any claim for indemnity, either party or an Indemnitee may submit the Indemnitee claim to the dispute resolution procedure provided for herein. Notwithstanding the foregoing, there shall be no obligation for one party to indemnify the other for any dispute in which the amount in controversy is less than $5,000.

4.4 Manner of Payments. Except as otherwise provided in this Agreement, any reimbursements or other payments to be made on and after the Distribution Date by any party to any other party hereunder shall be due within fifteen (15) calendar days of the receipt by the owing party of an invoice or other billing documentation accompanied by reasonably detailed supporting information.

4.5 Taxes. Yellow and SCST have entered into a Tax Sharing Agreement regarding their respective rights and obligations with respect to taxes of Yellow and SCST for all periods prior to (or including) the Distribution and certain other tax related matters. In the event of any conflict between the terms of the Tax Sharing Agreement and the terms of this Agreement, the terms of the Tax Sharing Agreement shall prevail.

4.6 Expenses. Except as otherwise provided in this Agreement or the Tax Sharing Agreement, all out-of-pocket expenses incurred in connection with the Distribution up to and including the Distribution Date shall be paid by Yellow. Thereafter, except as otherwise provided in this Agreement or in the Tax Sharing Agreement, each party shall bear its own expenses in connection with the Distribution.

4.7 Non-solicitation. For twenty-four (24) months after the date hereof, Yellow and SCST shall not, directly or indirectly, offer, induce, recruit, solicit, influence or attempt to influence any employee of the other or any of its subsidiaries to terminate his or her employment for the purpose of working for the other (without the prior written consent of the other party). This
Section 4.7 shall not prohibit one party from hiring an employee of the other party if such employment is the result of an employee's soliciting employment by the employ-

-20-

ing party without any inducement or attempt by the employing party to encourage said employee, or if the employment occurs as a result of a general solicitation for employment by one party not specifically directed at the other party.

ARTICLE V

DISPUTE RESOLUTION

5.1 Use of Dispute Resolution; Presumptions. Except as otherwise set forth in the Tax Sharing Agreement, resolution of any and all disputes arising from or in connection with this Agreement or the Tax Sharing Agreement, whether based on contract, tort or otherwise (collectively, "Disputes"), shall be exclusively governed by and settled in accordance with the provisions of this Article V, it being understood and agreed by SCST that any calculation or determination made by Yellow with respect to or in connection with the Distribution or this Agreement shall be deemed reasonable and binding on SCST absent manifest error.

5.2 Negotiation. The parties shall make a good faith attempt to resolve any Dispute through negotiation. Within fifteen (15) calendar days after notice of a Dispute is given by either party to the other party, each party shall select a negotiating team comprised of vice president-level employees of such party and shall meet within fifteen (15) calendar days after the end of the first fifteen (15) calendar day negotiating period to attempt to resolve the matter. During the course of negotiations under this Section 5.2, all reasonable requests made by one party to the other for Information, including requests for copies of relevant documents, will be honored. The specific format for such negotiations will be left to the discretion of the designated negotiating teams and may include the preparation of agreed upon statements of fact or written statements of position furnished to the other party.

5.3 Non-binding Mediation. In the event that any Dispute arising out of or related to this Agreement is not settled by the parties within fifteen (15) calendar days after the first meeting of the vice president-level negotiating teams under Section 5.2, the parties will attempt in good faith to resolve such Dispute by non-binding mediation in accordance with the American Arbitration Association Commercial Mediation Rules as in effect at such time. Mediation shall be held within thirty (30) calendar days of the end of such fifteen (15) calendar day negotiation period of the negotiating teams. Except as provided in
Section 5.4, no litigation for the resolution of such Dispute may be commenced until the parties attempt in good faith to settle the dispute by such mediation in accordance with such rules and either party has concluded in good faith that amicable resolution through continued mediation of the matter does not appear likely. The costs of mediation shall be shared equally by the parties to the mediation. Any settlement reached by mediation shall be recorded in writing, signed by the parties, and shall be binding on them.

-21-

5.4 Proceedings. Nothing herein, however, shall prohibit either party from initiating litigation or other judicial or administrative proceedings if there is a substantial likelihood that such party would be substantially harmed by a failure to act during the time that such good faith efforts are being made to resolve the Dispute through negotiation or mediation. In the event that litigation is commenced under this Section 5.4, the parties agree to continue to attempt to resolve any Dispute according to the terms of Section 5.2 and Section 5.3 during the course of such litigation proceedings under this Section 5.4.

5.5 Continuity of Service and Performance. Unless otherwise agreed in writing, the parties will continue to provide service on all of the commitments in this Agreement and the Tax Sharing Agreement during the course of dispute resolution pursuant to the provisions of this Article V with respect to all matters not subject to the Dispute.

5.6 Further Assurances. In addition to the actions specifically provided for elsewhere in this Agreement, each of the parties hereto shall use its reasonable best efforts to (i) execute and deliver such further documents and take such other actions as any other party may reasonably request in order to effectuate the purposes of this Agreement and to carry out the terms hereof, and
(ii) take, or cause to be taken, all actions, and to do or cause to be done all things reasonably necessary, proper or advisable under applicable law, regulation and agreements or otherwise to consummate and make effective the transactions contemplated by this Agreement, including without limitation using its reasonable best efforts to obtain any consents and approvals and make any filings and applications necessary or desirable in order to consummate the transactions contemplated by this Agreement.

ARTICLE VI

MISCELLANEOUS

6.1 Survival. The provisions of this Agreement shall survive the Distribution Date.

6.2 Entire Agreement. This Agreement supersedes and cancels any and all previous agreements, written or oral, between the parties relating to the subject matter hereof. This Agreement and the Tax Sharing Agreement express the complete and final understanding of the parties with respect to the subject matter thereto and may not be changed in any way, except as provided in Section 6.3.

6.3 Waiver and Modification. An amendment or modification of this Agreement will be valid and effective only if it is in writing and signed by each party to this Agreement. In addition, a waiver of any duty, obligation or responsibility of a party under this Agreement will be valid and effective only if it is evidenced by writing, signed by or on behalf of the party against whom the waiver or discharge is sought to be enforced. The waiver by either party of

-22-

a breach of a provision of this Agreement will not constitute a waiver of the succeeding breach of the provision or a waiver of the provision itself.

6.4 Notices. All notices, requests, consents and other communications hereunder to any party shall be deemed to be sufficient if contained in a written instrument delivered in person or sent by telecopy confirmed receipt, nationally recognized overnight courier, or first class registered or certified mail, return receipt requested, postage pre-paid, addressed to such party at the address set forth below:

If to Yellow to:

10990 Roe Avenue
Overland Park, KS 66211
Fax: (913) 696-6116
Attn: Senior Vice President-Legal and Corporate Secretary
e-mail: dan.churay@yellowcorp.com

If to SCST to:

One Main Plaza
4435 Main Street, Suite 930
Kansas City, MO 64111
Fax: (816) 714-5920
Attn: Vice President and Chief Financial Officer
e-mail: jbellinghausen@scstransportation.com

All notices, request, consents and other communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered; when receipt acknowledged, if telecopied; on the next business day after timely delivery to the courier, if sent by overnight courier guaranteeing next day delivery; and five business days after being deposited in the mail, postage pre-paid, if mailed.

6.5 Counterparts. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement.

6.6 Severability. In the event any provision of the Agreement or portion thereof is found to be wholly or partially invalid, illegal or unenforceable in any judicial proceeding, then such provision shall be deemed to be modified or restricted to the extent and in the manner necessary to render the same valid and enforceable or shall be deemed excised from this Agreement, as the case may require, and this Agreement shall be construed and enforced to the maximum extent permitted by law as if such provision had been originally incorporated

-23-

herein as so modified or restricted, or as if such provision had not been originally incorporated herein, as the case may be.

6.7 Assignment. Neither of the parties shall assign any of its rights or obligations under this Agreement without the prior written consent of the other party.

6.8 Choice of Law. This Agreement shall be interpreted under the laws of the State of Delaware, without giving effect to said state's conflict of laws principles.

6.9 No Third-Party Beneficiaries. This Agreement is not intended to, and does not, create any third-party contractual or other rights. No person or entity shall be deemed to be a third-party beneficiary with respect to this Agreement.

ARTICLE VII

DEFINED TERMS

7.1 Defined Terms.

Defined Term                                  Location in Document
------------                                  --------------------
Agreement..................................   Preamble
AIT........................................   2.5.2.2
Allocated Employees.......................    2.2
Benesight.................................    2.6.3
Billed Cost...............................    2.5.2.3
Collateral................................    2.5.2.3
Collateral Cost...........................    2.5.2.3
Collateral Requirements...................    2.5.2.3
Contributed Assets........................    2.1
Contributed Liabilities...................    2.1
Disclosure Letter.........................    1.2.1
Disputes..................................    5.1
Distribution..............................    Recitals
Distribution Date.........................    1.4
Fractional Shares.........................    1.3
Guarantees................................    2.5.1
Indemnifying Party........................    4.3
Indemnitee................................    4.3
Jevic.....................................    Recitals
Luciano...................................    2.6.2
Net Ultimate Liability of Yellow..........    2.5.2.2

-24-

Defined Term                                  Location in Document
------------                                  --------------------
Preston...................................    2.6.1
Saia......................................    Recitals
SCST......................................    Preamble
SCST Excess Liability.....................    2.5.2.2
SCST Indemnitees..........................    4.3
Separation................................    Recitals
TPA.......................................    2.5.2.4
Transactions..............................    Recitals
Yellow....................................    Preamble
Yellow Benesight Litigation Expenses......    2.6.3
Yellow Indemnitees........................    4.3
Yellow Luciano Litigation Expenses........    2.6.2
Yellow Payment............................    1.2.1

"Action" means any action, claim, suit, arbitration, subpoena, discovery request, proceeding or investigation by or before any court or grand jury, any Governmental Authority or arbitration tribunal.

"By-laws" means the By-laws of SCST, substantially in the form of Exhibit A.

"Certificate of Incorporation" means the Amended and Restated Certificate of Incorporation of SCST, substantially in the form of Exhibit B.

"Code" means the Internal Revenue Code of 1986, as amended.

"Commission" means the Securities and Exchange Commission.

"Consents" means any consents, waivers or approvals from, or notification requirements to, any third parties.

"Contribution Date" means the Distribution Date or such other date as is specified in the applicable section of the Disclosure Letter.

"Debt Agreements" means each of those agreements listed in paragraph 1.2.1 of the Disclosure Letter.

"Distribution Ratio" means the number of shares of Yellow Common Stock that a stockholder must own at the Record Date that will entitle such stockholder to receive one share of SCST Common Stock on the Distribution Date.

"Distribution Time" means 5:00 p.m., New York City time, on the Distribution Date.

-25-

"Effective Date" means the date on which the Registration Statement is declared effective by the Commission.

"Exchange Act" means the Securities Exchange Act of 1934, as amended, together with the rules and regulations promulgated thereunder.

"Governmental Approvals" means any notices, reports or other filings to be made to, or any consents, registrations, approvals, permits or authorizations to be obtained from, any Governmental Authority.

"Governmental Authority" means any federal, state, local, foreign or international court, government, department, commission, board, bureau, agency, official or other regulatory, administrative or governmental authority.

"Group" means the Yellow Group or the SCST Group, as the context requires.

"Information" means all administrative records, books, contracts and instruments, and all computer software (excluding any software not owned by Yellow or SCST, as the case may be) and computer data and other owned data and information.

"Information Statement" means the information statement included in the Registration Statement.

"Letter Ruling" means a private letter ruling received from the Internal Revenue Service to the effect that, among other things, the Distribution will qualify as a tax-free distribution for federal income tax purposes under Section 355 of the Code.

"Liabilities" means any and all indebtedness, liabilities or obligations, whether accrued, fixed or contingent, mature or inchoate, known or unknown, reflected on a balance sheet or otherwise, including, but not limited to, those arising under any law, rule, regulation, Action, order, injunction or consent decree of any Governmental Authority or any judgment of any court of any kind or any award of any arbitrator of any kind, and those arising under any contract, commitment or undertaking.

"Losses" means any and all damages, losses, deficiencies, Liabilities, obligations, penalties, judgments, settlements, claims, payments, fines, interest, costs and expenses (including, without limitation, the costs and expenses of any and all Actions and demands, assessments, judgments, settlements and compromises relating thereto and the reasonable costs and expenses of attorneys, accountants, consultants and other professionals' fees and expenses incurred in the investigation or defense thereof or the enforcement of rights hereunder), including direct and consequential damages, but excluding punitive damages (other than punitive damages awarded to any third party against an Indemnified Party).

-26-

"Person" means an individual, a general or limited partnership, a corporation, a trust, a joint venture, an unincorporated organization, a limited liability entity, any other entity and any Governmental Authority.

"Record Date" means the close of business on the date to be determined by Yellow's Board of Directors as the record date for determining stockholders of Yellow entitled to receive shares of SCST Common Stock in the Distribution.

"Registration Statement" means the Registration Statement (No. 001-31401) on Form 10 filed by SCST with the Commission to effect the registration of the SCST Common Stock pursuant to the Exchange Act in connection with the Distribution, as such registration statement may be amended from time to time.

"SCST Common Stock" means the common stock, par value $0.001 per share, of SCST, entitled to one vote per share.

"SCST Group" means SCST, each Subsidiary of SCST and each other Person that is either controlled directly or indirectly by SCST immediately after the Distribution Date.

"SCST Liabilities" means any and all Liabilities of SCST or any of its Subsidiaries of any kind or nature to the extent resulting from or arising out of the present, past or future operation or conduct of the business, operations or assets of SCST or of any Subsidiary of SCST, and shall include without limitation:

(i) Liabilities resulting from or arising out of the Contributed Assets;

(ii) Liabilities resulting from or arising out of the Contributed Liabilities;

(iii) Liabilities resulting from or arising out of the Allocated Employees;

(iv) Liabilities resulting from or arising out of the Guarantees;

(v) Liabilities allocated to SCST pursuant to Section 2.5.2.1;

(vi) Liabilities resulting from or arising out of the SCST Excess Liability;

(vii) Liabilities resulting from or arising out of the Collateral Costs;

(viii) Liabilities allocated to SCST pursuant to Section 2.5.2.4;

(ix) Liabilities resulting from or arising out of the litigation described in Section 2.6.2;

-27-

(x) Liabilities resulting from or arising out of the litigation described in Section 2.6.3;

(xi) Liabilities resulting from or arising out of the litigation described in Section 2.6.4;

(xii) Liabilities resulting from or arising out of the Jevic Employment Agreements; and

(xiii) Liabilities resulting from or arising out of the rights and claims described in Section 2.6.6.

"Securities Act" means the Securities Act of 1933, as amended, together with the rules and regulations promulgated thereunder.

"Subsidiary" of any Person means any corporation, partnership, limited liability entity, joint venture or other organization, whether incorporated or unincorporated, of which such Person or a Subsidiary of such Person, or such Person and one or more of its Subsidiaries, (i) directly or indirectly owns or control at least a majority of the securities or interests having by the terms thereof ordinary voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation; (ii) have control, whether contractual or otherwise; (iii) are a general partner, manager or managing member; or (iv) hold a majority of the equity interests.

"Tax Sharing Agreement" means that certain Tax Indemnification and Allocation Agreement by and between Yellow and SCST, substantially in the form of Exhibit C.

"Third Party Debt" means all debt in addition to that evidenced by the Debt Agreements listed in paragraph 1.2.1 of the Disclosure Letter residing on the books of SCST or its subsidiaries as of the Distribution Date and specifically excludes intercompany debt owed by SCST or its subsidiaries directly to Yellow. Third Party Debt is listed in paragraph 2.4 of the Disclosure Letter.

"Yellow Common Stock" means the common stock, par value $1.00 per share, of Yellow.

"Yellow Group" means Yellow, each Subsidiary of Yellow and each Person (other than any member of the SCST Group) that is either controlled directly or indirectly by Yellow immediately after the Distribution Date.

"Yellow Liabilities" means any and all Liabilities of Yellow or any of its Subsidiaries (other than SCST and its Subsidiaries) of any kind or nature to the extent resulting from or

-28-

arising out of the present, past or future operation or conduct of the business, operations or assets of Yellow or of any Subsidiary of Yellow (other than SCST and its Subsidiaries), and shall include Liabilities resulting from or arising out of the claims described in Section 2.6.1.

[Signature Pages Follow]

S-1

IN WITNESS WHEREOF, the parties have executed this Master Separation and Distribution Agreement as of the date first above written.

YELLOW CORPORATION

By: /s/ William F. Martin, Jr.
    ------------------------------------
    Name:  William F. Martin, Jr.
    Title: Senior Vice President

SCS TRANSPORTATION, INC.

By: /s/ James J. Bellinghausen
    ------------------------------------
    Name:  James J. Bellinghausen
    Title: VP Finance and Chief
             Financial Officer

EXHIBIT 10.4

EXECUTION COPY

TAX INDEMNIFICATION AND ALLOCATION AGREEMENT

THIS TAX INDEMNIFICATION AND ALLOCATION AGREEMENT ("Agreement") is entered into as of September 30, 2002 by and between YELLOW CORPORATION, a Delaware corporation ("Distributing Co."), and SCS TRANSPORTATION, INC., a Delaware corporation ("Controlled Co.") (Distributing Co. and Controlled Co. are sometimes collectively referred to herein as the "Companies"). Capitalized terms used in this Agreement are defined in Section 1 below. Unless otherwise indicated, all "Section" references in this Agreement are to sections of this Agreement.

PRELIMINARY STATEMENTS

A. As of the date hereof, Distributing Co. is the common parent of an affiliated group of corporations, including Controlled Co., which has elected to file consolidated Federal income tax returns.

B. The Companies have agreed to a distribution of all of the capital stock of Controlled Co. on a pro-rata basis to the shareholders of Distributing Co., in order to facilitate the separation of Controlled Co. from Distributing Co. (the "Distribution"). In connection therewith, the Companies have entered into the Master Separation and Distribution Agreement, dated as of September 30, 2002 (the "Distribution Agreement").

C. As a result of the Distribution, Controlled Co. and its Subsidiaries (as determined immediately after the consummation of the Distribution) will cease to be members of the affiliated group of which Distributing Co. is the common parent.

D. The Distribution is intended to qualify as a tax-free distribution to Distributing Co. and its shareholders under Section 355 of the Internal Revenue Code of 1986, as amended.

E. The Companies desire to provide for and agree upon the allocation between the parties of liabilities for Taxes arising prior to, as a result of, and subsequent to the transactions contemplated by the Distribution Agreement, and to provide for and agree upon other matters relating to Taxes.

AGREEMENT

NOW, THEREFORE, in consideration of the premises, the mutual covenants set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

-2-

Section 1. Definition of Terms. For purposes of this Agreement (including the recitals hereof), the following terms have the following meanings:

"Adjusted" means changed by an Adjustment.

"Adjustment" means with respect to a taxpayer for any Tax Period, any adjustment to such taxpayer's Tax liability (or Taxes paid) or entitlement to Carrybacks, Carryforwards, Tax refunds or credits for such Tax Period resulting from (a) a Final Determination, (b) any settlement or other agreement with a Tax Authority (including, without limitation, an acquiescence to any claim for additional Taxes made by a Tax Authority) or a voluntary payment of Taxes (made in connection with a pending or ongoing Tax Contest or otherwise) or (c) the filing of an amended Tax Return or any claim for refund or credit.

"Adjustment Request" means any formal or informal claim or request filed with any Tax Authority, or with any administrative agency or court, for an Adjustment, including (a) any amended Tax return claiming an Adjustment to the Taxes as reported on a Tax Return or, if applicable, as previously Adjusted, or
(b) any claim for refund or credit of Taxes previously paid.

"Affiliate" means any entity that directly or indirectly is "controlled" by the person or entity in question. "Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, by contract or otherwise. Except as otherwise expressly provided herein, the term "Affiliate" shall refer to Affiliates of a person as determined immediately after the Distribution. The term "Affiliate" includes Subsidiaries.

"Agreement" shall mean this Tax Indemnification and Allocation Agreement.

"Allocated Federal Tax Liability" shall have the meaning provided in
Section 5.1(b)(i).

"Allocated State Tax Liability" shall have the meaning provided in
Section 5.3(b)(1)(A).

"Carryback" means any net operating loss, net capital loss, excess tax credit, or other loss, credit or similar Tax item that may or must be carried from one Tax Period to an earlier Tax Period under the Code or other applicable Tax Law.

"Carryforward" means any net operating loss, net capital loss, excess tax credit, or other loss, credit or similar Tax item that may or must be carried from one Tax Period to a later Tax Period under the Code or other applicable Tax Law.

"Code" means the U.S. Internal Revenue Code of 1986, as amended, or any successor law.

-3-

"Companies" means Distributing Co. and Controlled Co., collectively, and "Company" means either of Distributing Co. or Controlled Co.

"Consolidated or Combined Income Tax" means any Income Tax computed by reference to the assets or activities of members of more than one Group.

"Consolidated or Combined State Income Tax" means any State Income Tax computed by reference to the assets or activities of members of more than one Group.

"Consolidated or Combined State Income Tax Return" means any Tax Return filed with respect to a Consolidated or Combined State Income Tax.

"Controlled Adjustment" means any proposed Adjustment asserted in a Tax Contest to the extent Controlled Co. would be liable for any resulting Tax under this Agreement or entitled to receive any resulting Tax Benefit under this Agreement (as determined by Distributing Co. in its sole discretion).

"Controlled Group" means Controlled Co. and its Affiliates.

"Controlled Group Indemnified Party" shall mean each member of the Controlled Group and its Affiliates, directors, officers, employees, agents and other representatives.

"Controlled Group Prior Federal Tax Liability" shall have the meaning provided in Section 2.2(b)(ii).

"Controlled Group Prior State Tax Liability" shall have the meaning provided in Section 2.3(b)(ii)(B).

"Controlled Group Recomputed Federal Tax Liability" shall have the meaning provided in Section 2.2(b)(i).

"Controlled Group Recomputed State Tax Liability" shall have the meaning provided in Section 2.3(b)(ii)(A).

"Cumulative Federal Tax Payment" shall have the meaning provided in
Section 5.1(b)(ii).

"Cumulative State Tax Payment" shall have the meaning provided in
Section 5.3(b)(1)(B).

"Distributing Co. Federal Consolidated Tax Return" means any United States Federal Tax Return for the affiliated group (as that term is defined in Code Section 1504) that includes Distributing Co. as the common parent and includes any member of the Controlled Group.

-4-

"Distributing Co. Prohibited Action" means (a) a disposal or discontinuance of the unionized trucking business conducted by Yellow Transportation, Inc. that causes Distributing Co. not to be engaged immediately after the Distribution in the active conduct of a trade or business (within the meaning of Section 355(b)(1)(A) of the Code), (b) a repurchase of Distributing Co. stock by Distributing Co. after the Distribution that does not satisfy the requirements of Section 4.05(1)(b) of IRS Revenue Procedure 96-30 or (c) a merger of Distributing Co. with another corporation, an acquisition by any person (taking into account the provisions of Section 355(e)(4)(C) of the Code) of 50% or more (by vote or value) of the outstanding stock of Distributing Co., or a liquidation of Distributing Co.

"Distributing Co. Tax Opinion" means any written legal opinion rendered to Distributing Co. regarding the U.S. Federal Income Tax treatment of the Distribution and/or any transactions undertaken in preparation for or in contemplation of the Distribution.

"Distributing Group" means Distributing Co. and its Affiliates.

"Distributing Group Indemnified Party" shall mean each member of the Distributing Group and its Affiliates, directors, officers, employees, agents and other representatives.

"Distribution" means the distribution to the shareholders of Distributing Co. of all of the outstanding capital stock of Controlled Co. owned by Distributing Co.

"Distribution Agreement" has the meaning set forth in the recitals hereto.

"Distribution Date" means the date on which the Distribution occurs.

"Distribution Taxes" means any Income Taxes imposed on Distributing Co. with respect to the distribution of the stock of Controlled Co. to the shareholders of Distributing Co. pursuant to Section 311(b) or Section 355 of the Code (including, without limitation, pursuant to Sections 355(d) or (e)) or any similar provision of state, local or non-U.S. Tax Law (but excluding any Income Tax resulting from the triggering of an excess loss account with respect to the stock of Controlled Co., which shall be considered a Restructuring Income Tax), computed without taking into account any available Tax losses or credits (or Carrybacks or Carryforwards) of members of the Distributing Group.

"Federal Income Tax" means any Tax imposed by Subtitle A or F of the Code.

"Final Determination" means (i) a decision, judgment, decree, or other order by a court of competent jurisdiction, which has become final and unappealable, or (ii) any other final disposition, including by reason of the expiration of the applicable statute of limitations or pursuant to Code Sections 1311 through 1313, or comparable provision of state, local, or foreign law.

-5-

"Foreign Income Tax" means any Tax imposed by any foreign country or any possession of the United States, or by any political subdivision of any foreign country, or United States possession, which is an income tax as defined in Treasury Regulations Section 1.901-2.

"Group" means the Distributing Group or the Controlled Group, as the context requires.

"Income Tax" means any Federal Income Tax, State Income Tax, or Foreign Income Tax.

"Indemnifiable Loss Claim" shall mean any claim asserted against any Distributing Group Indemnified Party that could give rise to an Indemnifiable Loss, and any related administrative or judicial proceedings.

"Indemnifiable Losses" of a Distributing Group Indemnified Party shall mean: (1) any and all Taxes and other liabilities directly or indirectly asserted against, imposed upon or incurred by such Distributing Group Indemnified Party as a result of the failure or asserted failure of the Distribution to satisfy the requirements of Section 355 of the Code, including, without limitation, any liability of such Distributing Group Indemnified Party arising out of or related to claims asserted against such Distributing Group Indemnified Party by any shareholder participating in the Distribution, whether or not any shareholder participating in the Distribution, or the IRS or any Tax Authority, ultimately is successful in seeking recourse against Distributing Co. or such Distributing Group Indemnified Party, and (2) all related costs and expenses (including, without limitation, reasonable attorneys' fees).

"IRS" means the Internal Revenue Service.

"IRS Letter Ruling" means an IRS private letter ruling, dated August 2, 2002, setting forth IRS rulings regarding certain Tax consequences of the Distribution and certain related transactions, together with any supplemental private letter rulings issued with respect thereto.

"Large Corporate Underpayment Rate" means the rate applicable, from time to time, pursuant to Section 6621(c) of the Code.

"Payment Date" means (i) with respect to any Distributing Co. Federal Consolidated Tax Return, the due date for any required installment of estimated taxes determined under Code Section 6655, the due date (determined without regard to extensions) for filing the return determined under Code Section 6072, and the date the return is filed, and (ii) with respect to any Tax Return for any Consolidated or Combined State Income Tax, the corresponding dates determined under the applicable Tax Law.

-6-

"Person" means an individual, partnership, limited liability company, corporation, trust, estate, unincorporated organization or other legal entity (including, without limitation, a government or agency or political subdivision thereof).

"Post-Distribution Period" means any Tax Period beginning after the Distribution Date and, in the case of any Straddle Period, the portion of such Straddle Period beginning the day after the Distribution Date.

"Pre-Distribution Period" means any Tax Period ending on or before the Distribution Date and, in the case of any Straddle Period, the portion of such Straddle Period ending on the Distribution Date.

"Prior Intercompany Tax Allocation Agreements" means any written or oral agreement or any other arrangements relating to the allocation of Taxes existing between or among the Distributing Group and/or the Controlled Group immediately prior to the Distribution (other than this Agreement and the Distribution Agreement and other than any such agreement or arrangement solely between or among entities that are members of a single Group).

"Prohibited Action" shall mean any action inconsistent with any representation made in connection with the IRS Letter Ruling, the Ruling Request or the Distributing Co. Tax Opinion.

"Required Action" shall mean any action necessary to comply with any representation made in connection with the IRS Letter Ruling, the Ruling Request or the Distributing Co. Tax Opinion.

"Responsible Company" means, with respect to any Tax Return, the Company having responsibility for preparing and filing such Tax Return under this Agreement.

"Restructuring Income Taxes" means (i) any Income Taxes (including, without limitation, any Income Taxes resulting from the triggering of deferred intercompany gains or excess loss accounts) imposed on the Distributing Group or the Controlled Group as a result of pre-Distribution transfers of assets (including, without limitation, any stock or other debt or equity interests in entities) or liabilities in connection with the Distribution or any other transactions undertaken in preparation for the Distribution, whether or not liability for such Income Taxes is triggered by the Distribution, and (ii) any Income Taxes imposed on the Distributing Group or the Controlled Group that are not described in clause (i) and that result from the triggering of any deferred intercompany gains or excess loss accounts by virtue of the Distribution, computed under both clause (i) and clause (ii), without taking into account any available Tax losses or credits (or Carrybacks or Carryforwards) of members of the Distributing Group.

-7-

"Ruling Request" means the ruling request filed by Distributing Co. with the IRS on April 1, 2002, requesting a ruling from the IRS regarding certain tax consequences of the Distribution and certain related transactions (including all attachments, exhibits, and other materials submitted with such ruling request) and any amendment or supplement to such ruling request.

"Separate Company Tax" means any Tax computed by reference to the assets and activities of a member or members of a single Group, but only if no member of the other Group may be or become liable (directly or secondarily) for such Tax (as determined by Distributing Co. in its sole discretion).

"Stand-Alone Tax Liability" of the Controlled Group with respect to any Distributing Co. Federal Consolidated Tax Return or Consolidated or Combined State Income Tax Return shall mean an amount (which may be positive or negative) equal to the sum of (1) the product of (a) the hypothetical taxable income or loss of the Controlled Group (determined without regard to any exemption amounts allowable under the Code or applicable state, local or non-U.S. law and without any portion of any Tax benefits described in Section 1561 of the Code (or any similar provision of state, local or non-U.S. law)) included in such Distributing Co. Federal Consolidated Tax Return or Consolidated or Combined State Income Tax Return and (b) the marginal federal, state or local income tax rate applicable to the Tax Period in question, less (c) the hypothetical net Tax credits of the Controlled Group included in such Distributing Co. Federal Consolidated Tax Return or Consolidated or Combined State Income Tax Return and
(2) the hypothetical alternative minimum tax liability (or similar state, local or non-U.S. tax liability) of the Controlled Group (determined without regard to any exemption amounts allowable under the Code or applicable state, local or non-U.S. law and without any portion of any Tax benefits described in Section 1561 of the Code (or any similar provision of state, local or non-U.S. law)) with respect to such Tax Return. In making the computations required by the preceding sentence, the hypothetical taxable income or loss, net Tax credits and/or alternative minimum Tax liability of the Controlled Group shall be determined as if the Controlled Group had been a separate affiliated, consolidated, combined or unitary group for the Tax Period in question (but not for any other Tax Period), but each Tax Item (including Carrybacks or Carryforwards) of each member of the Controlled Group shall be taken into account to the extent (and only to the extent) such Tax Item was actually utilized in the actual Distributing Co. Federal Consolidated Tax Return or the actual Consolidated or Combined State Income Tax Return in question. Thus, by way of examples, (1) gains and losses of the members of the Controlled Group arising with respect to transactions between a member of the Controlled Group and a member of the Distributing Group shall be taken into account only if and when such Tax Items are taken into account pursuant to Treasury Regulations
Section 1.1502-13 in determining the actual Tax Liability on the Distributing Co. Federal Consolidated Tax Return or Consolidated or Combined State Income Tax Return in question and (2) if a deduction, loss or credit of a member of the Controlled Group would have been util-

-8-

ized in a hypothetical stand-alone Tax Return of the Controlled Group, but such deduction, loss or credit was not actually utilized (by either a member of the Controlled Group or a member of the Distributing Group) in the actual Distributing Co. Consolidated Federal Tax Return or Consolidated or Combined State Income Tax Return in question, such Tax Item shall not be taken into account in determining Stand-Alone Tax Liability with respect to such Distributing Co. Consolidated Federal Tax Return or Consolidated or Combined State Income Tax Return. All determinations and computations regarding the Stand-Alone Tax Liability of the Controlled Group shall be made by Distributing Co. in its sole discretion.

"State Income Tax" means any Tax imposed by any State of the United States or by any political subdivision of any such State which is imposed on or measured by net income, including state and local franchise or similar Taxes measured by net income.

"Straddle Period" means any Tax Period that begins on or before and ends after the Distribution Date.

"Subsidiary" shall mean, with respect to any entity, any corporation, partnership, joint venture, limited liability company or other entity of which the first entity owns (directly or indirectly) 50% or more of the voting power of such entity or otherwise exercises control of such entity.

"Tax" or "Taxes" means (i) any income, gross income, gross receipts, profits, capital stock, franchise, withholding, payroll, social security, workers compensation, unemployment, disability, property, ad valorem, stamp, excise, severance, occupation, service, sales, use, license, lease, transfer, import, export, value added, alternative minimum, estimated or other similar tax (including any fee, assessment, or other charge in the nature of or in lieu of any tax) imposed by any Tax Authority (within or without the United States),
(ii) any interest, penalties, additions to tax, or additional amounts in respect of the foregoing and (iii) any transferee, successor, joint and several, contractual or other liability for any item described in clause (i) or clause (ii).

"Tax Authority" means, with respect to any Tax, the jurisdiction (or political subdivision thereof) or governmental entity that imposes such Tax, and the agency (if any) charged with the collection of such Tax for such jurisdiction or governmental entity.

"Tax Benefit" means any refund, credit, or other reduction in otherwise required Tax payments (including any reduction in estimated tax payments).

"Tax Contest" means an audit, examination, or any other administrative or judicial proceeding with the purpose or effect of redetermining Taxes of any of the Companies or their Affiliates (including any administrative or judicial review of any Adjustment Request) for any Tax Period ending on or before the Distribution Date or any Straddle Period.

-9-

"Tax Item" means, with respect to any Income Tax, any item of income, gain, loss, deduction, and credit.

"Tax Law" means the law of any jurisdiction (or political subdivision thereof) relating to any Tax.

"Tax Period" means, with respect to any Tax, the period for which the Tax is reported as provided under the Code or other applicable Tax Law, including any partial period for which estimated Tax is due.

"Tax Records" means Tax Returns, Tax Return workpapers, documentation relating to any Tax Contests, and any other books of account or records required to be maintained under the Code or other applicable Tax Laws or under any record retention agreement with any Tax Authority.

"Tax Return" means any return or report of Taxes due, any claims for refund of Taxes paid, any information return with respect to Taxes, or any other similar report, statement, declaration, or document required to be filed under the Code or other Tax Law, including any attachments, exhibits, or other materials submitted with any of the foregoing, and including any amendments or supplements to any of the foregoing.

"Transfer Taxes" means any transfer, documentary, stamp, sales, use, real estate transfer, capital or other similar Taxes imposed on members of the Distributing Group or on members of the Controlled Group (or their respective shareholders) in connection with (a) any pre-Distribution transfers of assets (including, without limitation, any stock or other debt or equity interests in entities) or liabilities in connection with the Distribution or any other transactions undertaken in preparation for the Distribution or (b) the Distribution.

"Treasury Regulations" means the regulations promulgated from time to time under the Code as in effect for the relevant Tax Period.

Section 2. Allocation of Tax and Certain Other Liabilities. The provisions of this Section 2 are intended to determine each Company's liability for certain Taxes. Once the liability has been determined under this Section 2,
Section 5 determines the time when payment of the liability is to be made, and whether the payment is to be made to the Tax Authority directly or to the other Company. Section 2.5 also provides for indemnification with respect to certain Tax and other matters.

2.1. General Rule.

(a) Distributing Co. Liability. Distributing Co. shall be liable for all Taxes of the Distributing Group not specifically allocated to Controlled Co. under this Section 2. Distrib-

-10-

uting Co. shall indemnify and hold harmless the Controlled Group Indemnified Parties from and against any liability for Taxes for which Distributing Co. is liable under this Section 2.1(a) and all related costs and expenses (including, without limitation, reasonable attorneys' fees).

(b) Controlled Co. Liability. Controlled Co. shall be liable for and shall indemnify and hold harmless the Distributing Group Indemnified Parties from and against any liability for Taxes and other amounts allocated to Controlled Co. under this Agreement and all related costs and expenses (including, without limitation, reasonable attorneys' fees).

2.2. Allocation of United States Federal Income Tax. Except as provided in Section 2.5:

(a) Allocation of Tax Relating to Federal Consolidated Tax Returns. With respect to any Distributing Co. Federal Consolidated Tax Return originally filed after the Distribution Date, Controlled Co. shall be liable to Distributing Co. for the Controlled Group's positive Stand-Alone Tax Liability, if any, with respect to such Distributing Co. Federal Consolidated Tax Return. If the Controlled Group has a negative Stand-Alone Tax Liability with respect to any Distributing Co. Federal Consolidated Tax Return described in the preceding sentence, Controlled Co. shall be entitled to a payment from Distributing Co. to the extent provided in the last sentence of Section 5.1(b).

(b) Allocation of Federal Consolidated Tax Return Adjustments. If there is any Adjustment after the Distribution Date to an originally filed Distributing Co. Federal Consolidated Tax Return, or to any such Tax Return as previously Adjusted (before or after the Distribution Date), Controlled Co. shall be liable to Distributing Co. for the excess (if any) of --

(i) the Stand-Alone Tax Liability (whether positive or negative) of the Controlled Group with respect to such Tax Return as so Adjusted (the "Controlled Group Recomputed Federal Tax Liability"); minus

(ii) the Stand-Alone Tax Liability (whether positive or negative) of the Controlled Group with respect to such Tax Return as originally filed (or if applicable, as previously Adjusted) (the "Controlled Group Prior Federal Tax Liability").

If the Controlled Group Prior Federal Tax Liability (whether positive or negative) exceeds the Controlled Group Recomputed Federal Tax Liability (whether positive or negative), Controlled Co. shall be entitled to a payment from Distributing Co. in accordance with Section 5.2(b).

-11-

For purposes of this Section 2.2(b), the determination and payment of estimated Taxes (including the determination and payment of any Tax required to be paid with a request for an extension of time to file a Tax Return) shall not be treated as an Adjustment.

2.3. Allocation of State Income Taxes. Except as provided in Section 2.5, State Income Taxes shall be allocated as follows:

(a) Separate Company Taxes. In the case of any State Income Tax which is a Separate Company Tax, Controlled Co. shall be liable for any such Tax imposed on any member of the Controlled Group for any Tax Period.

(b) Consolidated or Combined State Income Taxes. In the case of any Consolidated or Combined State Income Tax, the liability of Controlled Co. with respect to such Tax for any Tax Period shall be computed as follows:

(i) Allocation of Tax Reported on Tax Returns. In the case of any Consolidated or Combined State Income Tax Return originally filed after the Distribution Date, Controlled Co. shall be liable to Distributing Co. for the Controlled Group's positive Stand-Alone Tax Liability, if any, with respect to such Consolidated or Combined State Income Tax Return. If the Controlled Group has a negative Stand-Alone Tax Liability with respect to any Consolidated or Combined State Income Tax Return described in the preceding sentence, Controlled Co. shall be entitled to a payment from Distributing Co. to the extent provided in the last sentence of Section 5.3(b).

(ii) Allocation of Consolidated or Combined State Income Tax Adjustments. If there is any Adjustment after the Distribution Date to an originally filed Consolidated or Combined State Income Tax Return (or to any such Tax Return as previously Adjusted (before or after the Distribution Date)), Controlled Co. shall be liable to Distributing Co. for the excess (if any) of --

(A) the Stand-Alone Tax Liability (whether positive or negative) of the Controlled Group with respect to such Tax Return as so Adjusted (the "Controlled Group Recomputed State Tax Liability"); minus

(B) the Stand-Alone Tax Liability (whether positive or negative) of the Controlled Group with respect to such Tax Return as originally filed (or, if applicable, as previously Adjusted) (the "Controlled Group Prior State Tax Liability").

If the Controlled Group Prior State Tax Liability (whether positive or negative) exceeds the Controlled Group Recomputed State Tax Liability (whether positive or negative), Controlled Co. shall be entitled to a payment from Distributing Co. in accordance with Section 5.4(b)(1).

-12-

For purposes of this Section 2.3(b)(ii), the determination and payment of estimated Taxes (including the determination and payment of any Tax required to be paid with a request for an extension of time to file a Tax Return) shall not be treated as an Adjustment.

2.4. Allocation of Other Taxes. Except as provided in Section 2.5, all Taxes other than those specifically allocated pursuant to Sections 2.2 and 2.3 shall be allocated to the legal entity on which the legal incidence of the Tax is imposed and Controlled Co. shall be liable for all Taxes imposed on any member of the Controlled Group. The Companies believe that there is no Tax not specifically allocated pursuant to Sections 2.2, 2.3 or 2.5 which is legally imposed on more than one legal entity (e.g., joint and several liability); however, if there is any such Tax, it shall be allocated using principles similar to those set forth in Sections 2.2, 2.3 and 2.5, as determined by Distributing Co. in its sole discretion.

2.5. Transaction and Other Taxes. Controlled Co. shall be liable for, and shall indemnify and hold harmless the Distributing Group Indemnified Parties from and against:

(a) any Transfer Taxes;

(b) any Distribution Taxes and any Indemnifiable Losses, except to the extent such Distribution Taxes or Indemnifiable Losses are primarily the direct and proximate result of a Distributing Co. Prohibited Action (as determined by Distributing Co. in its reasonable discretion); and

2.6. Allocation of Unused Tax Attributes. Unused Tax attributes for Pre-Distribution Periods shall be allocated between the Groups in accordance with the Code and the Treasury Regulations (or comparable provisions of other Tax Law), or, where no treatment is specifically provided or required, as determined by Distributing Co. in its sole discretion.

Section 3. Proration of Tax Items for Straddle Periods.

3.1. General Method of Proration. In the case of any Straddle Period (including the Pre-Distribution Period of the Controlled Group ending on the Distribution Date and the Post-Distribution Period of the Controlled Group beginning on the day after the Distribution Date, if the taxable period of the Distributing Group does not end on the Distribution Date), Tax Items shall be apportioned between Pre-Distribution Periods and Post-Distribution Periods in accordance with the principles of Treasury Regulations Section 1.1502-76(b)(2)(ii) if and to the extent that Distributing Co. (in its sole discretion) elects to have such principles apply (and, if Distributing Co. elects to have such principles apply, as applied by Distributing Co. in its sole discretion).

-13-

3.2. Extraordinary Items. In determining the apportionment of Tax Items between Pre-Distribution Periods and Post-Distribution Periods, any Tax Items arising in connection with the Distribution or any transactions undertaken in preparation for the Distribution shall be treated as extraordinary items described in Treasury Regulations Section 1.1502-76(b)(2)(ii)(C) and shall be allocated to Pre-Distribution Periods to the extent and in the manner determined by Distributing Co. in its sole discretion.

Section 4. Preparation and Filing of Tax Returns.

4.1. General. Except as otherwise provided in this Section 4, Tax Returns shall be prepared and filed when due (including extensions) by the person obligated to file such Tax Returns under the Code or applicable Tax Law. The Companies shall provide, and shall cause their Affiliates to provide, assistance and cooperate with one another in accordance with Section 7 with respect to the preparation and filing of Tax Returns, including providing information required to be provided in Section 7.

4.2. Distributing Co.'s Responsibility. Distributing Co. shall prepare and file, or cause to be prepared and filed:

(a) all Distributing Co. Federal Consolidated Tax Returns;

(b) all Consolidated or Combined State Income Tax Returns;

(d) to the extent Distributing Co. so elects at any time, any Tax Returns (not described in clauses (a), (b) or (c)) with respect to Taxes for which any member of the Distributing Group may be or become liable directly or secondarily (including, without limitation, Transfer Taxes).

Any Tax Returns prepared and filed by Distributing Co. under this
Section 4.2 or under Section 4.3 shall be prepared exclusively by Distributing Co. in its sole discretion, and neither Controlled Co. nor any other member of the Controlled Group shall have any right to review or comment on the preparation of such Tax Returns or to consent or withhold consent to the filing of such Tax Returns (except as expressly provided in Section 4.5).

4.3. Controlled Co.'s Responsibility. Controlled Co. shall prepare and file, or shall cause to be prepared and filed, (i) all Tax Returns required to be filed after the Distribution Date by any member of the Controlled Group with respect to Separate Company Taxes and (ii) any other Tax Return (required to be filed after the Distribution Date) for or that includes any member of the Controlled Group that Distributing Co. does not elect to prepare and file

-14-

pursuant to Section 4.2(d). In the case of each Tax Return (if any) described in clause (ii) of the preceding sentence, Distributing Co. shall be given an opportunity to review and comment on such Tax Return (a draft copy of which shall be provided to Distributing Co. no later than 30 days prior to the due date for filing such Tax Return) and such Tax Return shall not be filed without the prior written consent of Distributing Co. (which may be given or withheld in Distributing Co.'s sole discretion); provided that, if Distributing Co. fails to provide its consent at least 10 days prior to the due date for filing such Tax Return, Distributing Co. shall assume exclusive control of, and shall be responsible for finalizing and filing, such Tax Return. Distributing Co. shall also be given an opportunity to review and comment on the consolidated federal income tax return of the Controlled Group for the short period beginning the day after the Distribution Date (a draft copy of which shall be provided to Distributing Co. no later than 30 days prior to the due date for filing such Tax Return), and such Tax Return shall be revised by Controlled Co. prior to filing to include any changes requested by Distributing Co. (in Distributing Co.'s sole discretion) and shall not be amended after filing without Distributing Co.'s prior written consent (which may be given or withheld in Distributing Co.'s sole discretion). No member of the Controlled Group or any of its Affiliates shall take any position, on any Tax Return filed on or after the Distribution Date, that could have adverse Tax consequences to Distributing Co. or any of its Subsidiaries with respect to any Tax Period ending on or prior to, or including, the Distribution Date.

4.4. Consolidated or Combined Returns. The Companies will elect and join, and will cause their respective Affiliates to elect and join, in filing consolidated, unitary, combined, or other similar joint Tax Returns (to the extent each entity is eligible to join in such Tax Returns) as and to the extent determined by Distributing Co. in its sole discretion.

4.5. Execution of Certain Tax Returns Prepared by Distributing Co. In the case of any Tax Return which is prepared and filed by Distributing Co. under Sections 4.2(d) or 4.3 but is required by law to be signed by Controlled Co. (or by its authorized representative), Controlled Co. shall be required to sign such Tax Return unless there is no reasonable basis for the tax treatment of any material item reported on the Tax Return.

4.6. Adjustment Requests.

(a) Distributing Co. Consent Required for Adjustment Requests Relating to Consolidated or Combined Income Tax. Unless Distributing Co. consents in advance in writing, which consent shall be granted or withheld in Distributing Co.'s sole discretion, (i) no Adjustment Request shall be filed with respect to any Consolidated or Combined Income Tax and (ii) any elections available to members of the Controlled Group to waive the right to claim in any Pre-Distribution Period any Carryback arising in a Post-Distribution Period with respect to any Consolidated or Combined Income Tax shall be made, and no affirmative election shall be made to claim any such Carryback. Any Adjustment Request which Distributing Co. consents to make under this Section 4.6 shall be prepared and filed by Distributing Co. in

-15-

its sole discretion. In connection with any Adjustment Request prepared and filed by Distributing Co. with respect to any Consolidated or Combined Income Tax (whether such Adjustment Request was requested by Controlled Co. or was initiated by Distributing Co. on its own), Controlled Co. shall provide to Distributing Co. all information required of the Controlled Group for the preparation and filing of such Adjustment Request in such form and detail as reasonably requested by Distributing Co. Notwithstanding anything to the contrary in this paragraph (a), the consent of Controlled Co. shall not be required for any Adjustment Request initiated by Distributing Co. or any member of the Distributing Group with respect to any Consolidated or Combined Income Tax (whether or not such Adjustment Request was requested by a member of the Controlled Group).

(b) Entitlement to the Benefit of Any Refunds or Credits with Respect to Consolidated or Combined Income Taxes. Any Tax Benefit arising with respect to any Adjustment of any Consolidated or Combined Income Tax (including, without limitation, any Tax Benefit arising with respect to a Carryback to a Pre-Distribution Period of a loss or credit of a member of the Controlled Group arising in a Post-Distribution Period) shall belong exclusively to the Distributing Group; it being understood that the Controlled Group shall share in any such Tax Benefit only to the extent that such Tax Benefit results in an adjustment in favor of Controlled Co. pursuant to Section 2.2(b) or Section 2.3(b)(ii).

(c) Application of This Section to Certain Other Taxes. Principles similar to those set forth in Sections 4.6(a) and (b) shall apply to Adjustments with respect to any Tax other than a Consolidated or Combined Income Tax if, pursuant to Section 2.4, Distributing Co. determines in its sole discretion that any member of the Distributing Group may be or become legally responsible (directly or secondarily) for such Tax.

Section 5. Tax Payments and Intercompany Billings.

5.1. Payment of Taxes with Respect to Distributing Co. Federal Consolidated Tax Returns Originally Filed After the Distribution Date. In the case of any Distributing Co. Federal Consolidated Tax Return that will originally be filed after the Distribution Date:

(a) Computation and Payment of Tax Due. Distributing Co. shall compute the amount of Tax required to be paid to the IRS with respect to such Tax Return (including, without limitation, any estimated Taxes) and shall pay such amount to the IRS on or before such Payment Date.

(b) Computation and Payment of Controlled Co. Liability with Respect to Tax Due. Within 10 days of receiving from Distributing Co. a written request for payment (and in no event later than five days before the corresponding Tax payment is payable by Distributing Co. to the IRS), Controlled Co. will pay to Distributing Co. the excess (if any) of --

-16-

(i) the Stand-Alone Tax Liability (whether positive or negative) of the Controlled Group under Section 2.2(a) with respect to such Tax Return through the Payment Date in question (the "Allocated Federal Tax Liability"), over

(ii) the cumulative net payments with respect to such Tax Return prior to such Payment Date by the members of the Controlled Group (the "Cumulative Federal Tax Payment").

If the Cumulative Federal Tax Payment of the Controlled Group is greater than the Allocated Federal Tax Liability of the Controlled Group as of any Payment Date, then Distributing Co. shall pay such excess to Controlled Co. within 10 days of Distributing Co.'s receipt of the corresponding Tax Benefit (i.e., through either a reduction in Distributing Co.'s otherwise required Tax payment or a credit or refund of prior Tax payments).

5.2. Payment of Federal Income Tax Related to Adjustments.

(a) Adjustments Resulting in Underpayments. Distributing Co. shall pay to the IRS when due any additional Federal Income Tax required to be paid as a result of any Adjustment to the Tax liability with respect to any Distributing Co. Federal Consolidated Tax Return. In connection with any Adjustment to a Distributing Co. Federal Consolidated Tax Return (whether or not such Adjustment results in a payment to the IRS), Distributing Co. shall compute the amount attributable to the Controlled Group in accordance with Section 2.2(b), and Controlled Co. shall pay to Distributing Co. any amount due under Section 2.2(b) (as determined by Distributing Co. in its sole discretion) within 10 days of receiving from Distributing Co. a written request for payment (and in no event later than five days before the corresponding Tax payment is payable by Distributing Co. to the IRS).

(b) Adjustments Resulting in Overpayments. Within 10 days of receipt by Distributing Co. of any Tax Benefit resulting from any Adjustment with respect to any Distributing Co. Federal Consolidated Tax Return, Distributing Co. shall pay to Controlled Co. any amounts due to Controlled Co. pursuant to the last sentence of Section 2.2(b).

5.3. Payment of State Income Tax with Respect to Returns Originally Filed After the Distribution Date. In the case of any State Income Tax Return that will originally be filed after the Distribution Date:

(a) Computation and Payment of Tax Due. As provided in Section 4, the Responsible Company shall compute the amount of Tax required to be paid to the applicable Tax Authority with respect to such Tax Return on such Payment Date (including, without limitation, any estimated Taxes) and:

-17-

(i) if such Tax Return is with respect to a Consolidated or Combined State Income Tax, Distributing Co. shall pay such amount to such Tax Authority on or before such Payment Date; and

(ii) if such Tax Return is with respect to any Tax other than a Consolidated or Combined Income Tax, the Responsible Company shall pay such amount to such Tax Authority on or before such Payment Date.

(b) Computation and Payment of Controlled Co. Liability with Respect to Tax Due. Within 10 days of receiving from Distributing Co. a written request for payment (and in no event later than five days before the corresponding Tax Payment is payable by Distributing Co. to the applicable Tax Authority), Controlled Co. will pay to Distributing Co.:

(i) in the case of any Consolidated or Combined State Income Tax Return, the excess (if any) of --

(A) the Stand-Alone Tax Liability (whether positive or negative) of the Controlled Group under Section 2.3(b)(i) with respect to such Tax Return through the Payment Date in question (the "Allocated State Tax Liability"), over

(B) the cumulative net payments with respect to such Tax Return prior to such Payment Date by the members of the Controlled Group (the "Cumulative State Tax Payment"); and

(ii) in the case of any Tax described in Section 5.3(a)(ii) for which Controlled Co. is responsible under this Agreement but Distributing Co. is the Responsible Company, the full amount of Tax due.

If, with respect to any Consolidated or Combined State Income Tax Return described in clause (i), the Cumulative State Tax Payment of the Controlled Group is greater than the Allocated State Tax Liability of the Controlled Group as of any Payment Date, then Distributing Co. shall pay such excess to Controlled Co. within 10 days of Distributing Co.'s receipt of the corresponding Tax Benefit.

5.4. Payment of State Income Tax Related to Adjustments.

(a) Adjustments Resulting in Underpayments.

(1) Consolidated or Combined State Income Taxes. Distributing Co. shall pay to the applicable Tax Authority when due any additional State Income Tax required to be paid as a result of any Adjustment to the Tax liability with respect to any Consolidated or Combined State Income Tax Return. In connection with any Adjust-

-18-

ment to a Consolidated or Combined State Income Tax Return (whether or not such Adjustment results in a payment to the applicable Tax Authority), Distributing Co. shall compute the amount attributable to the Controlled Group in accordance with Section 2.3(b)(ii) and Controlled Co. shall pay to Distributing Co. any amount due under
Section 2.3(b)(ii) (as determined by Distributing Co. in its sole discretion) within 10 days of receiving from Distributing Co. a written request for payment (and in no event later than five days before the corresponding Tax payment is payable by Distributing Co. to the applicable Tax Authority).

(2) Certain Other Taxes. With respect to any Tax described in
Section 5.3(b)(ii), Distributing Co. shall pay to the applicable Tax Authority when due any additional Taxes required to be paid as a result of any Adjustment. Within 10 days of receiving from Distributing Co. a written request for payment (and in no event later than five days before any such Tax is payable by Distributing Co. to the applicable Tax Authority), Controlled Co. shall pay to Distributing Co. an amount equal to the full amount of any such Tax.

(b) Adjustments Resulting in Overpayments.

(1) Consolidated or Combined State Income Taxes. Within 10 days of receipt by Distributing Co. of any Tax Benefit resulting from any Adjustment with respect to any Consolidated or Combined State Income Tax Return, Distributing Co. shall pay to Controlled Co. any amounts due to Controlled Co. pursuant to the last sentence of Section 2.3(b)(ii).

(2) Certain Other Taxes. With respect to any Tax described in
Section 5.3(b)(ii), within 10 days of receipt by Distributing Co. of any Tax Benefit resulting from any Adjustment, Distributing Co. shall pay to Controlled Co. an amount equal to such Tax Benefit (net of any Taxes imposed on Distributing Co. or Distributing Co.'s Affiliates in connection with the receipt of such Tax Benefit).

5.5. Payment of Separate Company Taxes. Except as otherwise provided in Sections 5.3(a)(ii) and 5.4(a)(2), each Company shall pay, or shall cause to be paid, to the applicable Tax Authority when due all Separate Company Taxes owed by such Company or a member of such Company's Group.

5.6. Computation of Underpayment and Overpayment Interest and Penalties with Respect to Consolidated or Combined Income Taxes. In connection with any change in the Stand-Alone Tax Liability of the Controlled Group giving rise to a payment (by Controlled Co. to Distributing Co., or by Distributing Co. to Controlled Co.) under Sections 5.2(a), 5.2(b), 5.4(a)(1) or 5.4(b)(1), Distributing Co. shall determine in its sole discretion whether

-19-

Controlled Co. owes Distributing Co. additional amounts attributable to underpayment interest and/or penalties and whether Distributing Co. owes Controlled Co. additional amounts attributable to overpayment interest. These determinations shall be made with respect to the Controlled Group on a hypothetical stand-alone basis, in a manner consistent with the determination of the Controlled Group's Stand-Alone Tax Liability; provided, however, that in no event shall Controlled Co. be entitled to a payment in respect of overpayment interest (with respect to a downward adjustment of the Controlled Group's Stand-Alone Tax Liability) that exceeds the overpayment interest actually received by Distributing Co. from the applicable Tax Authority (with respect to the Adjustment that gave rise to the reduction in the Controlled Group's Stand-Alone Tax Liability). Any amounts due under this Section 5.6 shall be paid in addition to, and simultaneously with, the amounts due under Sections 5.2(a), 5.2(b), 5.4(a)(1) or 5.4(b)(1) to which such amounts due under Section 5.6 relate.

5.7 Treatment of Certain Amounts Payable in Connection with Tax Contests. If, in connection with a Tax Contest (or potential Tax Contest) that might result in any change to the Stand-Alone Tax Liability of the Controlled Group, Distributing Co. or any of its Affiliates (i) makes a deposit with an applicable Tax Authority or (ii) posts a surety bond or incurs other costs or expenses, Controlled Co. shall pay to Distributing Co. the portion of such deposit, cost or expense that is attributable to the Controlled Group (as determined by Distributing Co. in its sole discretion, in a manner consistent with Distributing Co.'s determination (from time to time) of the Controlled Group's Stand-Alone Tax Liability). Any amounts payable by Controlled Co. under this Section 5.7 shall be paid to Distributing Co. within 10 days of Controlled Co.'s receipt from Distributing Co. of a written request for payment (and in no event later than five days before Distributing Co. will be required to fund the deposit or pay the cost or expense in question). If any deposit of Tax made by Distributing Co. that is funded in whole or in part by Controlled Co. (pursuant to this Section 5.7) is ultimately repaid to Distributing Co. by the applicable Tax Authority, Distributing Co. shall repay to Controlled Co. (within 10 days of Distributing Co.'s receipt of such repayment) the portion of such deposit that was funded by Controlled Co.

5.8. Indemnification Payments. With respect to any indemnification payment required under this Agreement the timing of which is not specifically addressed elsewhere in this Section 5, the indemnifying party shall pay the indemnified party within 10 days of receiving a written request for such indemnification payment.

Section 6. Interest on Late Payments. Any payment due from one Company to the other Company under Section 5 that is not paid by the latest date permitted for payment shall bear interest (from the latest permitted payment date through the date of actual payment) at the Large Corporate Underpayment Rate, compounded daily.

Section 7. Assistance and Cooperation. Each Company shall cooperate (and cause its Affiliates to cooperate) with the other Company and the other Company's agents, including

-20-

accounting firms and legal counsel, in connection with the Tax matters covered by this Agreement including (i) preparation and filing of Tax Returns, (ii) determining the liability for and amount of any Taxes due (including estimated Taxes) or the right to and amount of any refund of Taxes, (iii) examinations of Tax Returns and (iv) any administrative or judicial proceedings in respect of Taxes assessed or proposed to be assessed. Such cooperation shall include making information and documents in a Company's possession (or the possession of the Company's Affiliates) available to the other Company in accordance with Section
8. Each of the Companies shall also make available to each other, as reasonably requested and available, personnel (including officers, directors, employees and agents of the Companies or their respective Affiliates) responsible for preparing, maintaining, and interpreting information and documents relevant to Taxes, and personnel reasonably required as witnesses or for purposes of providing information or documents in connection with any administrative or judicial proceedings relating to Taxes. The Companies agree and acknowledge, for the avoidance of doubt, that nothing in this Section 7 shall alter the rights and obligations of the Companies under the other Sections of this Agreement (including, without limitation, any right of a Company to act in its sole discretion, or reasonable discretion or to take action without obtaining the consent of or consulting with the other Company).

Section 8. Tax Records.

8.1. Retention of Tax Records. Except as provided in Section 8.2, each Company shall preserve and keep all Tax Records exclusively relating to the assets and activities of its respective Group for Pre-Distribution Tax Periods, and Distributing Co. shall preserve and keep all other Tax Records relating to Taxes of the Groups for Pre-Distribution Tax Periods, for so long as the contents thereof may become material in the administration of any matter under the Code or other applicable Tax Law, but in any event until the later of (i) the expiration of any applicable statutes of limitation and (ii) seven years after the Distribution Date. If, prior to the expiration of the applicable statute of limitation and such seven-year period, a Company reasonably determines that any Tax Records which it is required to preserve and keep under this Section 8 are no longer material in the administration of any matter under the Code or other applicable Tax Law, such Company may dispose of such records upon 90 days' prior written notice to the other Company. Such notice shall include a list of the records to be disposed of describing in reasonable detail each file, book, or other records being disposed. The notified Company shall have the opportunity, at its cost and expense, to copy or remove within such 90-day period, all or any part of such Tax Records; provided that Controlled Co. shall have the right to copy or remove only such information as relates exclusively to members of the Controlled Group.

8.2. State Income Tax Returns. Tax Returns with respect to State Income Taxes and workpapers prepared in connection with preparing such Tax Returns shall be preserved and

-21-

kept, in accordance with the terms of Section 8.1, by the Company having liability for the Tax.

8.3. Access to Tax Records. The Companies and their respective Affiliates shall make available to each other for inspection and copying during normal business hours upon reasonable notice all Tax Records in their possession to the extent reasonably required by the other Company in connection with the preparation of Tax Returns, audits, litigation, or the resolution of items under this Agreement.

Section 9. Tax Contests.

9.1. Notice. Each of the Companies shall provide prompt notice to the other Company of any pending or threatened Tax audit, assessment or proceeding or other Tax Contest of which it becomes aware related to Taxes for Tax Periods for which it is indemnified by the other Company hereunder, and Controlled Co. shall provide prompt notice to Distributing Co. of any Tax Contest arising out of a Tax Return for which Distributing Co. was the Responsible Company (even if Controlled Co. is the indemnifying party with respect to such Tax Contest). Such notice shall be accompanied by copies of any notice and other documents received from any Tax Authority in respect of any such matters. If an indemnified party has knowledge of an asserted Tax liability with respect to a matter for which it is to be indemnified hereunder and such party fails to give the indemnifying party prompt notice of such asserted Tax liability, the failure to give prompt notice shall not relieve the indemnifying party of its indemnification obligations hereunder, except to the extent that the indemnifying party is actually and materially prejudiced thereby.

9.2. Control of Tax Contests.

(a) Separate Company Taxes. Except as otherwise provided in Section 9.2(b), in the case of any Tax Contest with respect to any Separate Company Tax, the Company having liability for the Tax shall have exclusive control over such Tax Contest, including any settlement thereof.

(b) Consolidated or Combined Income Taxes and Certain Other Taxes. In the case of any Tax Contest with respect to any Consolidated or Combined Income Tax or any other Tax (including a Transfer Tax) for which any member of the Distributing Group may be or become liable (directly or secondarily), Distributing Co. shall have exclusive control of such Tax Contest, including any settlement thereof. Distributing Co. shall be the only party representing the members of either Group before any Federal or State Tax Authority in connection with any such audit, examination or other Tax Contest, but Distributing Co. shall keep Controlled Co. reasonably informed of the status of any Controlled Adjustment at issue in any such Tax Contest.

-22-

(c) Effect of Exclusive Control. If, pursuant to Sections 9.2(a) or 9.2(b), a Company has exclusive control of a Tax Contest, such Company may settle or compromise the Tax Contest (or any portion thereof) on any terms deemed desirable to such Company (in its sole discretion) and, in doing so, such Company may act solely in the best interests of such Company (even if the settlement or compromise benefits such Company at the expense of the other Company or the other Company's Affiliates).

(d) Indemnifiable Loss Claims. Distributing Co. shall have exclusive control of any Indemnifiable Loss Claims (other than any claim for Taxes brought by a Tax Authority, which shall be governed by Section 9.2(b)), including any settlement thereof; provided that Distributing Co. may not settle or compromise any Indemnifiable Loss Claim without the prior written consent of Controlled Co., not to be unreasonably withheld. Distributing Co. shall be the only party representing any Distributing Group Indemnifiable Party in connection with any Indemnifiable Loss Claim, but Distributing Co. shall keep Controlled Co. reasonably informed of the status of any such claim.

Section 10. Effective Date; Termination of Prior Intercompany Tax Allocation Agreements. This Agreement shall become effective upon consummation of the Distribution. Immediately prior to the Distribution, (i) all Prior Intercompany Tax Allocation Agreements shall be terminated and (ii) any remaining obligations under such prior agreements shall be canceled.

Section 11. Action or Inaction Inconsistent with the Ruling Request. Controlled Co. covenants and agrees that no member of the Controlled Group or any of its Affiliates will take any Prohibited Action or fail to take any Required Action unless the person acting has obtained the prior written consent of Distributing Co. (which consent may be given or withheld in Distributing Co.'s sole discretion). In addition, unless otherwise required by law, no member of the Controlled Group or any of its Affiliates shall take any position on any Tax Return or for any other Tax purpose that is inconsistent with the treatment of the Distribution as a tax-free distribution under Section 355 of the Code (and any applicable provision of state, local or non-U.S. law).

Section 12. Survival of Obligations. The representations, warranties, covenants and agreements set forth in this Agreement shall be unconditional and absolute and shall remain in effect without limitation as to time.

Section 13. Treatment of Payments; Tax Gross Up.

13.1. Treatment of Tax Indemnity and Tax Benefit Payments. Except as otherwise provided in Section 13.3, any indemnification payments or payments in respect of Tax Benefits made by a Company to the other Company under this Agreement shall be reported for Tax purposes by the payor and the recipient as if such payments were distributions or capital con-

-23-

tributions, as appropriate, occurring immediately before the Distribution Date, but only to the extent such payments do not relate to a Tax allocated to the payor in accordance with Treasury Regulations Section 1.1552-1 (or under corresponding principles of other applicable Tax Laws).

13.2. Tax Gross Up. If, notwithstanding the manner in which any indemnification payments were reported, there is an Adjustment to the Tax liability of a Company as a result of its receipt of an indemnification payment, such payment shall be appropriately adjusted (as determined by Distributing Co., in its sole discretion) so that the amount of such payment, reduced by the amount of all Income Taxes payable with respect to the receipt thereof (but taking into account all correlative Tax Benefits resulting from the payment of such Income Taxes), shall equal the amount of the payment which the Company receiving such payment would otherwise (but for such unintended Taxes) have received pursuant to this Agreement.

13.3. Interest Under This Agreement. Anything herein to the contrary notwithstanding, to the extent one Company ("indemnitor") makes a payment of interest to another Company ("indemnitee") under Section 6 of this Agreement, the interest payment shall be treated as interest expense to the indemnitor (deductible to the extent provided by law) and as interest income by the indemnitee (includible in income to the extent provided by law). The amount of the payment shall not be adjusted under Section 13.2 to take into account any associated Tax Benefit to the indemnitor or increase in Tax to the indemnitee.

Section 14. Disagreements.

(a) Factual and Legal Determinations and Computational Matters. All factual and legal determinations and computations required to be made under this Agreement (including, without limitation, with respect to the amount of Stand-Alone Tax Liability of the Controlled Group (and any changes thereto from time to time), the amount of Transfer Taxes, Distribution Taxes, Indemnifiable Losses and Restructuring Income Taxes, the amount of indemnification payments to be made (from time to time) by either Company to the other Company and whether and to what extent Section 13.2 applies to any indemnification payment to be made hereunder) shall be made by Distributing Co. in its sole discretion and shall be conclusively presumed to be correct absent manifest and material error, except to the extent that this Agreement expressly provides that Distributing Co. shall make the determination or computation in its reasonable discretion. Accordingly, Controlled Co. may challenge a factual or legal determination or computation made by Distributing Co. only if (i) there has been manifest and material error on the part of Distributing Co. in making such determination or computation or (ii) solely as to those matters where this Agreement expressly requires Distributing Co. to use its reasonable discretion, Distributing Co.'s exercise of its discretion was unreasonable and, in either case, Controlled Co. shall have the burden of proving that Distributing Co.'s determination or computation was manifestly and materially in error or represented an unreasonable ex-

-24-

ercise of discretion (as the case may be). Any such dispute will be resolved in accordance with Article V, "Dispute Resolution" of the Distribution Agreement.

(b) Other Decisions. Except as otherwise expressly provided in this Agreement, any decisions required to be made under this Agreement that are not covered by clause (a) (including, without limitation, whether and how to resolve any Tax Contest or whether or not to make any Tax election permitted to be made under applicable law) shall be made by Distributing Co. in its sole discretion and, in making any such decision, Distributing Co. may act solely in its best interests (even if Distributing Co.'s decision benefits Distributing Co. at the expense of Controlled Co. or Controlled Co.'s Affiliates).

(c) Disputed Payments. If there is any dispute under this Agreement regarding the amount of any payment to be made by Controlled Co. to Distributing Co. or any Distributing Group Indemnified Party, or by Distributing Co. to Controlled Co., any disputed payments shall be made in accordance with Distributing Co.'s determination, computation or decision pending the resolution of such dispute, and any change ultimately made to Distributing Co.'s determination shall be given effect only after such dispute is finally resolved.

Section 15. Expenses. Except as otherwise provided in Section 14, each Company and its Affiliates shall bear their own expenses incurred in connection with preparation of Tax Returns, Tax Contests, and other matters related to Taxes under the provisions of this Agreement.

Section 16. General Provisions.

16.1. Notices and Addresses.

(a) Notices. Any notice, demand, request or report required or permitted to be given or made to any party under this Agreement shall be in writing and shall be deemed given or made when delivered in person or when sent by first class mail or by other commercially reasonable means of written communication (including delivery by an internationally recognized courier service, by facsimile transmission or by e-mail) to the party at the party's principal business address. A party may change the address for receiving notices under this Agreement by providing written notice of the change of address to the other party.

(b) Addresses.

Notice to Distributing Co. shall be provided to:

Yellow Corporation
10990 Roe Avenue
Overland Park, KS 66211

-25-

Attention: Tax Director

Fax: (913) 696-6116

Notice to Controlled Co. shall be provided to:

SCS Transportation, Inc.
One Main Plaza
4435 Main Street, Suite 930 Kansas City, MO 64111
Attention: Tax Director
Fax: (816) 714-5920

16.2. Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their successors and assigns.

16.3. Waiver. No failure by any party to insist upon the strict performance of any obligation under this Agreement or to exercise any right or remedy under this Agreement shall constitute waiver of any such obligation, right, or remedy or any other obligation, rights, or remedies under this Agreement.

16.4. Invalidity of Provisions. If any provision of this Agreement is or becomes invalid, illegal or unenforceable in any respect, the validity, legality, and enforceability of the remaining provisions contained herein shall not be affected thereby.

16.5. Further Action. The parties shall execute and deliver all documents, provide all information and take or refrain from such reasonable taking action as may be necessary or appropriate to achieve the purposes of this Agreement, including the execution and delivery to the other Company and its Affiliates and representatives of such powers of attorney or other authorizing documentation as is reasonably necessary or appropriate in connection with Tax Contests (or portions thereof) under the control of such other Company in accordance with Section 9.

16.6. Integration. This Agreement constitutes the entire agreement among the parties pertaining to the subject matter of this Agreement and supersedes all prior agreements and understandings pertaining thereto. In the event of any inconsistency between this Agreement and the Distribution Agreement or any other agreements relating to the transactions contemplated by the Distribution Agreement, the provisions of this Agreement shall control.

16.7. Confidentiality. Any information or documentation received by Controlled Co. or its Affiliates, agents or representatives from Distributing Co. (or Distributing Co.'s Affiliates, agents or representatives) that relates to any Consolidated or Combined Income Tax matters shall be used solely for purposes of this Agreement and shall be kept confidential, except

-26-

as may otherwise be necessary in connection with the filing of any Consolidated or Combined Income Tax Returns or in connection with any administrative or judicial proceeding relating to Consolidated or Combined Income Taxes.

16.8. Construction. The language in all parts of this Agreement shall in all cases be construed according to its fair meaning and shall not be strictly construed for or against any party.

16.9. No Double Recovery; Subrogation. No provision of this Agreement shall be construed to provide an indemnity or other recovery for any costs, damages, or other amounts for which the damaged party has been fully compensated under any other provision of this Agreement or under any other agreement or action at law or equity. Unless expressly required in this Agreement, a party shall not be required to exhaust all remedies available under other agreements or at law or equity before recovering under the remedies provided in this Agreement.

16.10. Method of Making Payments. All payments required to be made by either party under this Agreement shall be made in immediately available funds (either by wire transfer, certified check or other similar means).

16.11. Third Party Beneficiaries. The Distributing Group Indemnified Parties (and their respective legal representatives, heirs, administrators, executors, successors and assigns) are intended third party beneficiaries of this Agreement. Except as provided in the preceding sentence or as otherwise expressly provided herein, this Agreement shall not confer any rights or remedies upon any Person other than the parties to this Agreement and their legal representatives, heirs, administrators, executors, successors and assigns.

16.12. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument.

16.13. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware applicable to contracts executed in and to be performed in that State.

[Signature Pages Follow]

EXECUTION COPY

S-1

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their respective officers as of the date first written above.

YELLOW CORPORATION

By: /s/ William F. Martin, Jr.
    -------------------------------------
    Name:  William F. Martin, Jr.
    Title: Senior Vice President

SCS TRANSPORTATION, INC.

By: /s/ James J. Bellinghausen
    -------------------------------------
    Name:  James J. Bellinghausen
    Title: VP Finance and Chief Financial
             Officer

EXHIBIT 99.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of SCS Transportation, Inc. (the "Company") on Form 10-Q for the period ending September 30, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Herbert A. Trucksess, III, Chairman, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Herbert A. Trucksess, III
---------------------------------------
Herbert A. Trucksess, III
Chairman, President and Chief Executive
   Officer
SCS Transportation, Inc.
November 4, 2002

EXHIBIT 99.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of SCS Transportation, Inc. (the "Company") on Form 10-Q for the period ending September 30, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, James J. Bellinghausen, Vice President of Finance and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ James J. Bellinghausen
----------------------------------------
James J. Bellinghausen
Vice President of Finance and Chief
   Financial Officer
SCS Transportation, Inc.
November 4, 2002

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents


		PAGE

PART I. FINANCIAL INFORMATION
ITEM 1:	Financial Statements

Condensed Consolidated Balance Sheets September 30, 2002 and December 31, 2001		3

Condensed Consolidated Statements of Operations Quarter and Nine Months Ended September 30, 2002 and 2001		4

Condensed Consolidated Statements of Cash Flows Nine Months Ended September 30, 2002 and 2001		5

Notes to Condensed Consolidated Financial Statements		6-10

ITEM 2:	Management’s Discussion and Analysis of Results of Operations and Financial Condition	10-15

ITEM 3:	Quantitative and Qualitative Disclosures About Market Risk	16

ITEM 4:	Controls and Procedures	16

PART II. OTHER INFORMATION

ITEM 1:	Legal Proceedings	17

ITEM 2:	Changes in Securities and Use of Proceeds	17

ITEM 3:	Defaults Upon Senior Securities	17

ITEM 4:	Submission of Matters to a Vote of Security Holders	17

ITEM 5:	Other Information	17

ITEM 6:	Exhibits and Reports on Form 8-K	17

Signature		20

Certifications		21-22

Exhibit Index		E-1


				September 30,			December 31,
				2002			2001

ASSETS
Current Assets:
	Cash			$	2,383		$	1,480
	Accounts receivable				99,233			83,387
	Prepaid expenses and other				35,558			28,589

		Total current assets			137,174			113,456

Property and Equipment:
	Cost				491,200			477,108
	Less: accumulated depreciation				194,515			171,067

		Net property and equipment			296,685			306,041

	Goodwill and Other Assets				19,449			92,449

		Total assets		$	453,308		$	511,946

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
	Accounts payable and checks outstanding			$	23,584		$	30,815
	Wages and employees’ benefits				31,448			26,816
	Other current liabilities				31,067			28,036
	Current maturities of long-term debt				—			6,489

		Total current liabilities			86,099			92,156

Other Liabilities:
	Long-term debt, less current portion				127,100			32,346
	Notes to former Parent				—			90,157
	Deferred income taxes				54,590			58,949
	Claims, insurance and other				14,751			8,689

		Total other liabilities			196,441			190,141

Shareholders’ Equity:
	Preferred stock, $.001 par value, 50,000 authorized, none issued and outstanding				—			—
	Common stock, $.001 par value; 50,000,000 shares authorized, 14,565,478 shares issued and outstanding				15			—
	Additional paid-in capital				200,133			—
	Retained earnings (deficit)				(29,380	)		—
	Parent company equity				—			229,649

		Total shareholders’ equity			170,768			229,649

			Total liabilities and shareholders’ equity	$	453,308		$	511,946


			Third Quarter					Nine Months

			2002		2001			2002			2001

Operating Revenue			$	201,155	$	195,152		$	581,181		$	586,764

Operating Expenses:
	Salaries, wages and employees’ benefits			112,604		110,325			330,516			331,560
	Purchased transportation			20,854		19,206			58,861			52,971
	Operating expenses and supplies			34,792		34,971			97,382			109,960
	Operating taxes and licenses			7,778		7,714			23,265			23,700
	Claims and insurance			5,439		5,421			17,201			15,169
	Depreciation and amortization			11,359		12,194			33,717			36,774
	Operating (gains) and losses			233		(240	)		495			(454	)
	Integration charges			—		—			—			6,705

		Total operating expenses		193,059		189,591			561,437			576,385

Income from Operations				8,096		5,561			19,744			10,379
Nonoperating Expenses:
	Interest expense			1,201		2,413			3,913			9,082
	Other, net			77		91			153			83

		Nonoperating expenses, net		1,278		2,504			4,066			9,165
Income Before Income Taxes and Cumulative Effect of Accounting Change				6,818		3,057			15,678			1,214
Income Tax Provision				2,813		1,634			6,652			2,246

Income (Loss) Before Cumulative Effect of Accounting Change				4,005		1,423			9,026			(1,032	)
Cumulative Effect of Change in Accounting for Goodwill				—		—			(75,175	)		—

Net Income (Loss)			$	4,005	$	1,423		$	(66,149	)	$	(1,032	)

Average common shares outstanding — basic and diluted				14,565		14,565			14,565			14,565

Basic and Diluted Earnings (Loss) Per Share:
	Before cumulative effect of accounting change		$	0.27	$	0.10		$	0.62		$	(0.07	)
	Cumulative effect of change in accounting for goodwill			—		—			(5.16	)		—

	Net Income (Loss)		$	0.27	$	0.10		$	(4.54	)	$	(0.07	)


				2002			2001

Operating Activities:
			Net cash provided by operating activities	$	17,232		$	39,820

Investing Activities:
	Acquisition of property and equipment				(29,359	)		(17,748	)
	Proceeds from disposal of property and equipment				4,987			3,688

			Net cash used in investing activities		(24,372	)		(14,060	)
Financing Activities:
		Proceeds from issuance of long-term debt			110,789			—
		Repayment of long-term debt			(22,525	)		(1,298	)
		Equity contribution from former Parent			—			815
		Net change in Notes to former Parent			(80,221	)		(26,835	)

			Net cash provided by (used in) financing activities		8,043			(27,318	)

Net increase (decrease) in cash					903			(1,558	)
Cash at beginning of period					1,480			4,922

Cash at end of period				$	2,383		$	3,364

Supplemental Cash Flow Information:
			Income taxes paid, net	$	14,713		$	485

			Interest paid	$	4,404		$	9,081

Non cash transactions:
			Equity contribution from former Parent	$	6,936		$	—

			Decrease in intercompany debt	$	(6,936	)	$	—


	Quarter Ended September 30,				Nine Months Ended September 30,

	2002		2001		2002		2001

Reported income (loss) before cumulative effect of accounting change	$	4,005	$	1,423	$	9,026	$	(1,032	)
Add: Goodwill amortization		—		746		—		2,248

Adjusted income before cumulative effect of accounting change	$	4,005	$	2,169	$	9,026	$	1,216

Basic and diluted earnings per share:
Reported income (loss) before cumulative effect of accounting change	$	0.27	$	0.10	$	0.62	$	(0.07	)
Goodwill amortization		—		0.05		—		0.15

Adjusted income before cumulative effect of accounting change	$	0.27	$	0.15	$	0.62	$	0.08


						Corporate
						and
		Saia		Jevic		Other			Consolidated

As of September 30, 2002
	Identifiable assets	$	295,982	$	157,676	$	(350	)	$	453,308
As of December 31, 2001
	Identifiable assets	$	280,427	$	231,519	$	—		$	511,946
Quarter ended September 30, 2002
	Operating revenue	$	127,580	$	73,575	$	—		$	201,155
	Income (loss) from operations		6,526		1,851		(281	)		8,096
Quarter ended September 30, 2001
	Operating revenue	$	125,072	$	70,080	$	—		$	195,152
	Income (loss) from operations		5,077		1,060		(576	)		5,561
Nine months ended September 30, 2002
	Operating revenue	$	366,636	$	214,545	$	—		$	581,181
	Income (loss) from operations		16,176		3,650		(82	)		19,744
Nine months ended September 30, 2001
	Operating revenue	$	367,179	$	219,585	$	—		$	586,764
	Income (loss) from operations		6,577		4,919		(1,117	)		10,379

	•		Claims and Insurance Accruals. SCST has self-insured retention limits generally ranging from $250,000 to $1,000,000 for medical, workers’ compensation, auto liability, casualty and cargo claims. The liabilities associated with the risk retained by SCST are estimated in part based on historical experience, third-party actuarial analysis, demographics, severity and other assumptions. However, these estimated accruals could be significantly affected if the actual costs of SCST differ from these assumptions and historical trends.

	•		Depreciation and Capitalization of Assets. Under the SCST accounting policy for plant and equipment, management establishes appropriate depreciable lives and salvage values for SCST’s revenue equipment (tractors and trailers) based on their estimated useful lives and estimated fair values to be received when the equipment is sold or traded in. These estimates are continuously evaluated and updated when circumstances warrant. However, actual depreciation and salvage values could differ from these assumptions based on market conditions and other factors.

	•		Recovery of Goodwill. On January 1, 2002, SCST adopted Financial Accounting Standards Board Statement No. 142 — Goodwill and Other Intangible Assets. The statement requires that, on adoption and at least annually thereafter, SCST assess goodwill impairment by applying a fair value based test. This fair value based test involves assumptions regarding the long-term future performance of the operating subsidiaries of SCST, fair value of the assets and liabilities of SCST, cost of capital rates and other assumptions. However, actual recovery of goodwill could differ from these assumptions based on market conditions and other factors.

	•		Revenue Recognition and Related Allowances. SCST’s accounting policy for revenue recognition is based on relative times for shipments in transit at the balance sheet date with expenses being recognized as incurred. In addition, estimates included in the recognition of revenue and accounts receivables include estimates of unbilled revenue, estimates of shipments in transit and estimates of future adjustments to revenue and accounts receivable for billing adjustments and collectibility.

			Estimates of unbilled revenue arise from a time lag of generally up to 3 days between the pick-up of the shipment and the generation of the invoice. This revenue is recognized in a systematic process and the estimate is for invoices that are essentially complete, with little subjectivity of the amounts accrued. Estimates of shipments in transit are based upon actual shipments picked up, scheduled day of delivery and current trend in average rates charged to customers. Since the cycle of the majority of shipments is generally 1-3 days, typically less than 5 percent of a total month’s revenue is in transit at the end of any month. Estimates for credit losses and billing adjustments are based upon historical experience of credit losses, adjustments processed and trends of collections. Billing adjustments are primarily made for discounts and billing corrections. These estimates are continuously evaluated and updated, however changes in economic conditions, pricing arrangements, etc. can significantly impact these estimates.


		Nine months			Year ended		Year ended
		ended 2002			2001		2000

Land and structures:
	Additions	$	6.6		$	3.3	$	11.1
	Sales		(1.1	)		—		(0.4	)
Revenue equipment			12.2			8.6		38.9
Technology and other			6.7			7.7		9.4

Total		$	24.4		$	19.6	$	59.0


			Payments Due by Fiscal Year

													There-
			2002 ⁽¹⁾		2003		2004		2005		2006		after		Total

Contractual Cash Obligations
Recorded Obligations:
	Revolving line of credit ⁽²⁾		$	—	$	—	$	—	$	10.7	$	—	$	—	$	10.7
	Long-term debt ⁽²⁾			—		—		—		1.3		6.4		108.7		116.4
Operating leases				2.4		8.1		5.7		3.7		1.8		1.1		22.8

		Total contractual obligations	$	2.4	$	8.1	$	5.7	$	15.7	$	8.2	$	109.8	$	149.9


Exhibit
Number		Description of Exhibit

3.1		Amended and Restated Certificate of Incorporation of SCS Transportation, Inc.

3.2		Amended and Restated By-laws of SCS Transportation, Inc.

4.1		Rights Agreement between SCS Transportation, Inc. and Mellon Investor Services LLC dated as of September 30, 2002

10.1		Agented Revolving Credit Agreement dated as of September 20, 2002, among SCS Transportation, Inc. and Bank of Oklahoma, N.A., U.S. Bank National Association, Bank One, NA, and Harris Trust and Savings Bank, and Bank of Oklahoma, N.A., as agent for the Banks (incorporated herein by reference to Exhibit 10.1 of SCS Transportation, Inc.’s Form 8-K (File No. 0-49983) filed on October 2, 2002)

10.2		Senior Notes Master Shelf Agreement dated as of September 20, (incorporated herein by reference to Exhibit 10.2 of SCS Transportation, Inc.’s Form 8-K (File No. 0-49983) filed on October 2, 2002)

10.3		Master Separation and Distribution Agreement between Yellow Corporation and SCS Transportation, Inc.

10.4		Tax Indemnification and Allocation Agreement between Yellow Corporation and SCS Transportation, Inc.

99.1		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.2		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


	Third Quarter				%		Nine Months					%

	2002		2001		Change		2002		2001			Change

Operating revenue		127,581		125,072		2.0		366,635		367,179			(0.1	)
Operating income		6,526		5,077				16,176		6,577	*
Operating ratio		94.9		95.9				95.6		98.2


									Third Quarter

		Third Quarter				%			Amount/Workday				%

		2002		2001		Change			2002		2001		Change

Workdays										64		63
F/S Revenue	LTL		117,496		115,093		2.1			1,835.9		1,826.9		0.5
	TL		10,085		9,979		1.1			157.6		158.4		(0.5	)
	Total		127,581		125,072		2.0			1,993.5		1,985.3		0.4
Revenue excluding	LTL		117,572		115,083		2.2			1,837.1		1,826.7		0.6
revenue recognition	TL		10,091		9,978		1.1			157.7		158.4		(0.4	)
adjustment	Total		127,663		125,061		2.1			1,994.8		1,985.3		0.5
Tonnage	LTL		602		574		4.9			9.40		9.10		3.3
	TL		138		136		1.3			2.15		2.16		(0.3	)
	Total		740		710		4.2			11.55		11.26		2.6
Shipments	LTL		1,131		1,076		5.1			17.67		17.09		3.4
	TL		17		16		11.4			0.27		0.25		9.7
	Total		1,148		1,092		5.2			17.94		17.34		3.5
Revenue/cwt	LTL		9.77		10.03		(2.6	)
	TL		3.67		3.67		(0.1	)
	Total		8.63		8.82		(2.1	)
Revenue/cwt	LTL		9.56		9.76		(2.0	)
(excluding fuel surcharge)	TL		3.65		3.63		0.4
	Total		7.78		7.89		(1.4	)
Revenue/shipment	LTL		103.96		106.91		(2.8	)
	TL		577.78		636.64		(9.2	)
	Total		111.17		114.51		(2.9	)


Date: November 4, 2002		/s/ James J. Bellinghausen

		James J. Bellinghausen Vice President of Finance and Chief Financial Officer

1.		I have reviewed this quarterly report on Form 10-Q of the registrant;

2.		Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or 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;

3.		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;

4.		The registrant’s other certifying officer 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:

	a)		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;

	b)		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

	c)		presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

	a)		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

	b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls; and


				/s/ Herbert A. Trucksess, III

				Herbert A. Trucksess, III Chairman, President and Chief Executive Officer