SCHEDULE 14A INFORMATION
Soliciting Materials Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
[Amendment No............]
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement (Revocation of Consent)
/ / Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/ / Definitive Proxy Statement (Revocation of Consent Statement)
/X/ Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-12
WISCONSIN CENTRAL TRANSPORTATION CORPORATION
--------------------------------------------
(Name of Registrant as specified in its charter)
(Name of person(s) filing proxy statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a6(i)(2) or
Item 22(a)(2) of Schedule 14A.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
_______________________
2) Aggregate number of securities to which transaction applies:
_______________________
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and state how it was
determined): _______________________
4) Proposed maximum aggregate value of transaction:
_______________________
5) Total fee paid: _______________________
/ / Fee paid previously by written preliminary materials.
/ / Check box if any part of the fee is offset as provided in Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid: ________________________________________
2) Form, Schedule or Registration Statement No.: __________________
3) Filing Party: __________________________________________________
4) Date Filed: ____________________________________________________
Sch 14A - Cover Page
<PAGE>
[Wisconsin Central Transportation Corporation logo]
The Write Track
News for Wisconsin Central Customers
December 2000, No. 67
--------------------------------------------------------------------------------
WHAT'S NEW?
o SNOW SLOWS, BUT DOESN'T STOP CHICAGO TRAINS--Chicago railroads survived the
season's first blizzard, December 11, along with subsequent snowfalls that
dumped a record 38.9 inches--surpassing the December record of 33.3 inches
set in 1951. Unlike January 1999, when trains were delayed for days, rail
freight kept moving during a "Level 3" alert from December 15-18. This
required all Chicago railroads to reduce traffic levels into the gateway
for switching and to reroute some trains to other interchange points,
following plans established earlier in the year by the Chicago
Transportation Coordination Office. Although hump yard production at major
terminals was sometimes 50% to 70% of normal, the Chicago terminal remained
fluid during the month. "The city was not in gridlock," says Dave
Kruschwitz, WC director operations network. A few railroads experienced
delays receiving trains December 23-31, due more to reduced Holiday
schedules than winter storms.
o NEW CAR DUMP SYSTEM AT ESCANABA--A new bottom-dump car unloading system is
under construction at Escanaba, Mich., which will give Wisconsin Central
the flexibility to accommodate conventional hoppers and other bottom-dump
equipment in addition to rotary dumping 50-ton and 70-ton ore cars. A
conveyor system will direct product either to stockpiles or the ship
loader. "We expect to handle new business from two Mesabi range pellet
producers during the first half of 2001," says WC Marketing Director Bill
Boukas.
o FUEL SURCHARGE COMING DOWN--Wisconsin Central plans to reduce the fuel
surcharge from 3% to 2%, effective January 9. The price of West Texas
Intermediate Crude Oil has fallen below $32 per barrel for the past 30
days. The 3% surcharge went into effect October 9, 2000.
o ALGOMA STEEL TO RECEIVE MICHIGAN ORE BY RAIL--Beginning in 2001, Wisconsin
Central will begin delivering approximately 1.4 million gross tons of iron
ore year round from the Tilden Mine in upper Michigan to Algoma Steel at
Sault Ste. Marie, Ontario. For the past four winters, WC has hauled an
average of 300,000 gross tons to Algoma Steel. All-rail shipping provides
warmer, cleaner pellets and reduces inventory.
o WC SEEKS TO RAISE CLASS I THRESHOLD TO $500 MILLION--The U.S. Surface
Transportation Board recently called for comments on a proposal that would
require railroads under common control to report to the STB on a
consolidated basis. This could ultimately result in WC becoming a Class I
carrier--subject to much more costly reporting and operating obligations.
WC filed comments opposing this reporting change and also separately
petitioned the STB to raise the threshold for Class I rail carriers from
$250 million to $500 million. The Class I threshold was last increased from
$100 million to $250 million in 1992.
o RECEIVE WC NEWS RELEASES BY E-MAIL, FAX--Customers wishing to receive
Wisconsin Central news releases directly and automatically by e-mail or
facsimile should provide their phone number, FAX and/or e-mail address to
Ann Thoma, WC's assistant VP corporate relations: [email protected]. or FAX
(847) 318-9078.
--------------------------------
KEEPING TRACK
We're concluding our 13th year at Wisconsin Central and, as usual, time
seems to have flown by quickly. Once again, the year included a variety of
activities to make it memorable.
Businesswise, 2000 was one of modest revenue growth--at least by WC
standards--along with a very successful effort at cost control and service
improvement. We've had another strong year of capital investment, including
expansion of log loading and iron ore unloading capacity. There also were
equipment improvements, including the addition of 100 boxcars for paper service
and 185 bulkhead flat cars to be rehabilitated primarily for log service. On the
customer side, we've also seen capacity expansions at 17 of our major customer
facilities throughout the entire system.
Perhaps not popular, but for the first time in Wisconsin Central's history,
we implemented a fuel surcharge due to extraordinary increases in fuel expense.
On the legal front, we've also had a variety of exchanges with the STB as
they try to redefine their merger rules and make reporting changes that could
result in reclassifying Wisconsin Central as a Class I railroad, which you know
we oppose.
On the service front, we're proud to say that transportation service on WC
has been excellent most of the year, and all the railroads should be proud of
what seems to be an improvement in the Chicago terminal area dealing with winter
weather.
Just to keep our lives interesting, we are the subject of a corporate proxy
fight. Meanwhile, the company has hired several outside organizations to test
the market for possible sale of all, or portions of our property. At this
writing, the voting is still in process and we will keep you advised of the
outcome.
As the year closes, our country has a new president and, despite some
question concerning the economy, customers we've talked to are still expressing
confidence for the next year.
As always, all of us at Wisconsin Central thank you for support and
patronage and wish you all the best for a healthy and prosperous New Year.
Bill Schauer
Vice President-Marketing
--------------------------------
Page - 1
<PAGE>
OSHKOSH TRUCK GEARS UP FOR U.S. MARINE CONTRACT
Oshkosh Truck, Oshkosh, Wis., is gearing up to build more than 8,000 MTVR
(Medium Tactical Vehicle Replacement) trucks for the U. S. Marines. If all
options are exercised, the five-year contract has a potential value of $1.2
billion--the largest ever for the 83-year old company.
Oshkosh is ramping up production in 2001 by adding some 400 jobs and more
than 100,000 sq. ft. of production space for an expanded assembly line to build
the state-of-the-art vehicles.
Oshkosh Traffic Manager Tom Petersen oversees the company's plans to ship
the completed MTVRs by rail--two per 89-ft. flat car. He notes, "We've worked
closely with the Wisconsin Central, the military, and with delivering railroads
to assure there will be uninterrupted car supply so vehicles will get to
destination on time. Wisconsin Central has been very supportive of this effort."
Oshkosh is also looking at rail to bring in various heavy or larger components.
Oshkosh is the leading manufacturer of heavy duty, multi-wheel drive
vehicles and pioneered four-wheel drive trucks in 1917 because of the difficulty
getting around Wisconsin, when roads were not well plowed.
The company has annual sales of $1.32 billion and produces specialty trucks
and truck bodies for defense, fire and emergency, snow removal, concrete
placement and refuse hauling under the Oshkosh, Pierce and McNeilus brand names.
--------------------------------
THE WRITE TRACK
WISCONSIN CENTRAL SYSTEM
Wisconsin Central Ltd.
Algoma Central Railway Inc.
Fox Valley & Western Ltd.
Sault Ste. Marie Bridge Co.
Wisconsin Chicago Link Ltd.
P. O. Box 5062 * Rosemont, IL 60017-5062
J. Reilly McCarren, President & CEO
William R. Schauer, Vice President-Marketing
Customer Service Center 1-800-822-6440
Marketing/Rate Desk 1-800-852-8335
Web site: www.wclx.com
--------------------------------
HOW'S BUSINESS?
Total Revenue Units
(Excludes units moved
under contract for
Canadian National)
Tabular Representation of Omitted Graph
2000 1999
---------- ---------
January 43,083 43,907
February 44,262 38,058
March 47,744 43,053
April 49,906 46,340
May 49,894 48,220
June 48,220 48,855
July 49,352 45,928
August 49,502 48,970
September 41,723 44,965
October 45,725 48,191
November 49,274 42,763
December 44,515
--------------------------------
WC ADDS LANDINGS, CARS FOR LOG LOADING
In 2000, Wisconsin Central added or expanded landings at eight locations
for loading pulpwood and sawlogs. The railroad is also acquiring 150 bulkhead
flatcars that will be rehabilitated with side stakes for log service.
WC has landings at 120 locations in Wisconsin, Upper Michigan and Ontario.
"L'Anse, Mich. is newest and was completed in December," according WC Marketing
Director Jeff Anderson. Located on the branchline from Ishpeming to Baraga,
L'Anse can accommodate 15 cars. Train service is provided three days a week.
Other new or expanded landings are Newberry, Quinnesec, and White Pine,
Mich.; Sprague and Superior Wis.; and Perry Pit and Oba, Ontario.
Typically, the greater the distance, the more advantageous it can be to
ship logs by rail, notes Brian Buchanan, WC's assistant manager marketing.
"Loggers like the fact that they can make many short trips in a day from the
wood source to the railroad loading point, as opposed to only one or two trips
to the mill. In addition, they save wear and tear on their truck and use less
fuel."
Landings are for public use and anyone can utilize them to either load or
unload rail cars, which typically carry between 27 and 38 cords, depending on
the car type.
"It's a relatively simple process," Buchanan explains. "Feel free to call
me at 1-800-852-8335, extension 4677 to check out shipping rates. I'll explain
the process, step-by-step."
--------------------------------
HOW CUSTOMERS CAN HELP AVOID WEATHER-RELATED DELAYS
o Remove compacted snow and ice from track flangeways at crossings and
parking areas so freight cars won't derail.
o Keep track switch points and switch stands clear of snow and ice so that
switches can be operated safely.
o Clean walkways where crews may need access to the facility or freight cars.
o Make sure close clearance signs are free of snow and clearly visible.
--------------------------------
Page - 2
<PAGE>
HIGHLIGHTS OF 2000
AWARDS
Based on a national survey of customers, Logistics Management &
Distribution Report magazine gave Wisconsin Central its 12th consecutive
"Readers Choice" award for excellence in on-time performance, value,
information technology, customer service, equipment and operations. WC also
received a service award from C. H. Robinson Worldwide for "high standards,
reliability and professionalism."
BNSF-CN PACT BENEFITS
In a pre-merger agreement with Burlington Northern Santa Fe and Canadian
National, beginning April 1, WC gained competitive switching charges at
Duluth-Superior; access to three CN distribution facilities in Chicago; new
Chicago trackage rights; plus a direct connection to the Chicago SouthShore
& South Bend railroad.
CUSTOMER EXPANSIONS
In 2000, a total of 33 companies built or expanded facilities or track
served by the Wisconsin Central System, or reactivated tracks to reinstate
rail service.
E-COMMERCE
Wisconsin Central's Web site (http://www.wclx.com) was expanded to allow
customers to use the Internet to complete bills of lading on line, trace
equipment, obtain information on current car movements and schedules, and
seek waybill history and scale weights.
EQUIPMENT
WC acquired 100 100-ton boxcars for paper shipments and 185 bulkhead flat
cars. Of these, 150 will be equipped with side stakes to handle log
shipments and 35 will be modified to handle coiled wire, which can be
loaded onto the cars without extensive blocking and bracing.
FUEL SURCHARGE
On July 1, Wisconsin Central added a fuel surcharge totaling 2% in an
effort to offset higher cost of fuel, which had doubled from last year. The
surcharge rose to 3% October 9.
MARKETING
Operating revenues increased 3.7% in the first nine months of 2000, with
gains in most commodities, notably paper. A new woodchip move to
International Paper began June 28, which is expected to increase WC's
annual woodchip volume by an average of 20%.
MECHANICAL
In 2000, WC mechanical forces overhauled 8 locomotives and 569 freight
cars, including 90 open-top hopper cars that were equipped with
remote-control gates to discharge track ballast and other products. In
addition, air dryers were installed on 30 locomotives completing the
program on 244 diesel units. At Gladstone, Wis., WC engineering forces
built a 65-ft. x 75-ft. addition to the mechanical facility and erected a
70-ton sanding tower.
OPERATIONS
Effective July 5, Wisconsin Central began a daily direct Chicago
interchange with the Union Pacific Railroad at Proviso yard, saving as much
as one-day on shipments destined to points east of North Platte, Neb.
PROXY BID
On October 20, a shareholder committee announced a proxy filing, seeking to
replace WCTC's current board of directors and sell all or portions of the
company. On November 3, WCTC announced retaining Goldman, Sachs &Co. to act
as a financial advisor in evaluating--among other alternatives--putting the
company up for sale and disposing of its international holdings.
RESTRUCTURING
WC restructured its North American rail operations, trimming 44 management
jobs and realigning transportation personnel to focus on local issues and
customer service. Terminals at Fond du Lac, Green Bay, Neenah and Stevens
Point were reorganized to function on a stand-alone basis.
TRACKWORK
By year end, production track crews will have installed more than 226,000
crossties, 460,500 tons of crushed rock ballast, 115 miles of continuously
welded rail, and surfaced (aligned and smoothed) about 1,100 miles of
track. Major projects in 2000 include extending or constructing track
sidings at DuPlainville, Hiawatha, Park-land and Vernon, Wis. and adding
2.5 miles of second main track east of Stevens Point, Wis. Track speeds
were increased from 25 to 40 mph on 45 miles of track on the Manistique,
Marinette and Algoma Central Northern subdivisions. New bridges were
installed at Chittamo, Exeland, Sheldon and Stanberry, Wis. Crossing
approaches were extended for 60 mph trains and crossing warning equipment
was upgraded at 34 locations.
--------------------------------
WISCONSIN CENTRAL SYSTEM
Our Pledge:
"To offer superior transportation
consisting of more frequent,
dependable train service, at
competitive prices, with proper
equipment, accomplished by
customer-minded and safety-
conscious employees."
--------------------------------
Page - 3
<PAGE>
WHO'S CALLING?
Scott Adams' 23-year railroad career spans two "UPs"--the first was the
Union Pacific where he began railroading at Pocatello, Idaho in 1977, and the
second is the Upper Peninsula of Michigan, where he has been manager market
development since December 1999.
Scott is a third generation railroader. His father was freight agent for
the UP at Idaho Falls and his grandfather was agent at Aberdeen, Idaho.
Following in their footsteps, Scott held a number of clerical positions with the
UP working first as a general clerk and train order operator before transferring
to Omaha in 1983 as office manager in the sales department. He held similar
posts in Cincinnati, Ohio and Kansas City, Mo. before becoming a sales
representative in 1989. He joined Gateway Western (subsequently Kansas City
Southern) in 1993 working as a market manager until joining WC a year ago. Along
the way, he earned a BS in human resource management from Friends University at
Wichita, Kan.
How does he like working for WC? "I really love the Upper Peninsula and the
people--there are a lot of similarities with Idaho. I enjoy working with the WC
team up here. The WC employees are attuned to the customer and trying to get new
business and
[Photo of Scott Adams]
Scott Adams
Manager Market Development
Michigan Operations
keeping what we've got."
Scott's territory extends from Escanaba, Mich. west to Argonne, Wis., Iron
Mountain and Baraga, Mich., east
[Inset Quote]
"The WC employees are
attuned to the customer and
trying to get new business and
keeping what we've got."
to Sault Ste. Marie, Mich., and south to just shy of Menominee, Mich.
Business is growing, Scott says. "We've seen a lot of increase in wood
going to the paper mills as well as logs going to the sawmills." He notes
Wisconsin Central has been expanding the number of log landings in Upper
Michigan and Wisconsin to attract more wood off the highway.
Economics favor rail shipping--particularly for hauls of 100 miles or more,
according to Scott. "With diesel prices staying high, there's been a shift of
interest by loggers in doing more shipping by rail, and then going back into the
forest where they can get another load."
The railroad is making a special effort to add and upgrade
landings--keeping them clear of bark, branches and snow. Scott explains, "It's
important that we offer a product to the loggers that when they pull in, they
don't get stuck or have to worry about their rigs." And the feedback from
loggers has been positive, according to Scott. "They're really pleased with the
product that we offer."
Scott recently became involved with Operation Lifesaver and is looking
forward to teaching residents about rail-crossing safety.
Scott and his wife, Janet, reside in Gladstone and have five children and
one grandchild.
In his spare time, Scott likes cross country skiing, fishing and hunting.
He also collects pocket knives.
--------------------------------
THE WRITE TRACK
Wisconsin Central System
P. O. Box 5062
Rosemont, IL 60017-5062
--------------------------------
Page - 4
