Labor and Working Conditions:

The company employs a total of approximately 700 workers in the four countries it operates. About 480 of these are drivers while the rest are maintenance shop technicians and administrative personnel. Over 50% of the workers hired are based in Costa Rica. The company provides employees with information about the terms of employment including rights under national labor and employment law, including their rights related to wages and benefits. In Costa Rica, this information is provided under a Direct Agreement signed by the company and elected worker representatives and reviewed and approved by the Ministry of Labor and under the individual employment contracts. In other countries this information is provided in Collective Agreements between the company and its workers and under individual employment contracts. The company is one of only a few companies in the transportation business which pay a base monthly salary to its drivers, providing additional incentives for total miles traveled. Due to security concerns for travel between Central American countries, company policy limits the number of working hours to daylight hours. Typical work schedules total about 48 hours per week although some local laws allow for maximum 12-hour shifts. Drivers who must stay away from home overnight also receive per-diem expenses to cover food costs.

Transamerica respects workers rights to form and to join workers organizations in the countries in which it operates as evidenced by the signing of a Collective Agreement between the company and the main workers unions in each respective country. Workers are able to express grievances through their labor representatives, supervisors, or directly to company management. Labor laws in all Central American countries where the company operates afford workers the opportunity to seek resolution for grievances not addressed by their employers. In Costa Rica, workers have a toll free number sponsored by the Ministry of Labor which allows for anonymous consultations about employer and employee labor rights.

The company applies non-discriminatory hiring practices and employee selection process is based on the experience and qualifications of the individual applying for a particular position in compliance with the non-discrimination requirements from the host countries. Vacancy announcements are posted in the local newspaper or via radio advertisements. The company complies with local laws prohibiting the use of pre-employment or post-employment drug testing even though this is a critical safety issue for truck operators globally.

The company provides new employees at its maintenance and yard operations with induction training on health and safety issues, relying on the audits occasionally conducted by government agencies to verify compliance with local requirements. The company does not report any significant injuries or accidents in its maintenance and yard operations except for occasional minor cuts and bruises.

Pollution Prevention and Abatement:

The company is continually striving to increase the fuel efficiency of the fleet due to the significant cost of diesel fuel. Fuel efficiency improvement methods include such actions as route planning, continued preventive mechanical maintenance of each vehicle, and monitoring of tire wear and tire pressure. The company closely tracks fuel consumption across all routes and provides fuel based on the length of the trip to avoid over-consumption or fuel theft. Truck emissions are evaluated annually as part of government-required vehicle inspections and certifications. Emissions’ testing typically consists of a visual test for the presence of heavy black smoke. The company conducts mechanical maintenance activities at its Costa Rican, Nicaraguan, and Salvadoran operations generating limited types and quantities of effluents which primarily consist of truck washing effluents and stormwater runoff from truck yards and maintenance operations. Effluents from these sources are treated via oil water separators prior to discharge to external drainage systems.

Fleet maintenance activities result in the generation of approximately 92,000 liters (24,000 gallons) of waste oil per year. Waste oil is temporarily stored in 55-gallon drums for subsequent transport, treatment and disposal by external contractors. Waste oil in Costa Rica is transported by a third party and disposed of through use as supplemental firing fuel in a cement kiln. Waste oil removal and disposal from other operations is also performed by third parties. Operations also result in the generation of significant quantities of used tires. Tires changes associated with preventive maintenance are usually conducted in Costa Rica where they are disposed of through use as a supplemental firing fuel in a cement kiln.

The company will prevent waste oil spills by keeping waste oil and used oil filter storage drums closed when not being filled or emptied. The company will store waste oil drums on a spill containment pallet or similar spill containment structure to avoid accidental releases to soil and will protect them from rainfall. The company will also maintain spill containment kits and train workers in their use.

The company owns a 9-year old 22,000 liter underground storage tank (UST) for diesel fuel equipped with overfill protection, located at the Costa Rica headquarters. The UST is permitted and occasionally inspected by Costa Rican environmental authorities. The operation of the fueling facility in Costa Rica is subcontracted. Fueling operations are other facilities are also subcontracted to third parties although they are either performed with the use of above-ground storage tanks or at third party, commercial, locations.

The main source of atmospheric emissions consists of the combustion emission from the transport fleet operated by the company. Additional emissions sources include indirect emissions from the production of electricity for own consumption, mainly the operation of reefer containers at the company’s various storage yards. Screening estimates from all of these sources indicate that total GHG emissions are below 100,000 ton-CO2 equivalent per year.

Community Health, Safety, and Security:

The company incorporates driver safety into various aspects of the business process including the driver hiring process, as the company checks traffic and background records as well as recommendations from previous employers to ensure that drivers have the required experience and minimum standards of compliance with traffic rules, and through verification of candidates’ driving skills through in-house driving test prior to hiring. The company also has an aggressive preventive maintenance program that keeps track of the wear of key equipment components such as breaks, tires, and engine oil and programs their replacement within the programmed business cycle. All trucks are equipped with governors that limit their maximum speed. The company is joining forces with its main competitors in Costa Rica to sponsor a training program for new, young, drivers at Costa Rica’s main vocational training center, the National Training Institute (INA). The first group of 27 graduates is expected for 2007 with 9 of these destined for hiring by the Company. The Company does not report any driver fatalities or serious injuries over the last three years although fatalities involving third parties have been reported in Costa Rica, Nicaragua, and Honduras.

The company will include a detailed analysis of accidents into its driver safety management program to incorporate the lessons learned into a more rigorous driver training program for new and existing drivers.

The company trucks are sometimes required to transport cargo containing hazardous materials. The company has a procedure which requires its clients to disclose and provide information about hazardous contents of the shipment. Hazardous shipments are placarded and transported with a bill of lading and drivers are sometimes trained by company clients.

The company will incorporate special provisions and procedures for the management of shipments containing hazardous materials in the overall driver training program.

The company has an emergency response procedure with clear internal and external reporting requirements in the event of an accident or mechanical breakdown. The procedure relies on transit authorities to respond to serious cases while the company has a system in place to respond to mechanical breakdowns using internal resources. The procedure includes a contact list and the location from which equipment should be provided depending on the geographic location of the breakdown. The emergency preparedness and response plan will be updated to include procedures to prepare and respond to accidental releases of hazardous materials.

The company contracts the services of external security services to control access and egress of personnel and equipment from its operations in Costa Rica, Nicaragua, and El Salvador. Security guards are typically unarmed. The highest security risks are associated with truck highjacking and cargo theft which have become an issue for the trucking industry during nighttime transport activities primarily in Nicaragua, El Salvador, and Honduras. The company policy now prohibits nighttime operation along high risk routes and some clients provide armed escorts who accompany drivers either in the cab or on separate vehicles.

The company will make reasonable inquiries to satisfy itself that the companies and individuals hired by its clients to provide armed security for the escort of company trucks have not been implicated in past abuses, and are adequately trained in the use of force and appropriate conduct toward workers and the local community.