!

December 3, 2012

Mr. Eric A. Sisco President, APM Terminals North America 1000 APM Terminals Boulevard Portsmouth, VA 23703 757-686-6501 – Office 757-686-6508 – Fax Eric.Sisco@apmterminals.com

Mr. Ryan Pedraza Program Manager Office of Transportation Public-Private Partnerships 600 East Main Street, Suite 2120 Richmond, VA 23219

Dear Mr. Pedraza:

APM Terminals is pleased to submit the enclosed Detailed Proposal with respect to a concession

of the Port in accordance with Version 2 the "Instructions to Proposers Relating to a Concession

of the Port of Virginia" dated as of November 19, 2012 (the ITP).

Below please find the names and addresses of the Proposer Team:

APM Terminals Virginia, Inc.

1000 APM Terminals Boulevard

Portsmouth, VA 23703-2631

Capitalized terms used but not defined in this letter shall have their respective meaning set forth

in the ITP.

Very truly yours,

Eric A. Sisco

President, APM Terminals North America

Enclosures

Signature on fileSignature on file

1

December 3, 2012

APM Terminals 1000 APM Terminals Boulevard Portsmouth, VA 23703-2631 ELECTRONIC COPY

Detailed Proposal for the Concession of The Port of Virginia

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Table of Contents

PART 1 – QUALIFICATIONS ...................................................................................................... 4

I. UNIFYING THE PORT OF VIRGINIA ................................................................................. 4

II. APM TERMINALS GLOBAL ORGANIZATION AND PORTFOLIO ............................... 5

Global Terminal Network ....................................................................................................... 5

APM Terminals Americas ...................................................................................................... 6

APM Terminals Virginia ........................................................................................................ 6

III. EXPERIENCE AS A SINGLE OPERATOR ......................................................................... 7

IV. PRINCIPLES OF THE APM TERMINALS BUSINESS MODEL ..................................... 10

Safety .................................................................................................................................... 10

Global Commercial Relationships ........................................................................................ 10

Productivity ........................................................................................................................... 11

Innovation and Technology .................................................................................................. 12

Environmental Responsibility ............................................................................................... 12

V. INDUSTRY RECOGNITION ............................................................................................... 14

PART 2 a – BUSINESS PLAN .................................................................................................... 15

I. EXECUTIVE SUMMARY ................................................................................................... 15

II. DETAILED OPERATIONS AND MAINTENANCE PLAN .............................................. 20

Safety .................................................................................................................................... 20

Process Excellence ................................................................................................................ 21

Operations Plan ..................................................................................................................... 23

Maintenance Plan .................................................................................................................. 29

III. MARKETING PLAN ............................................................................................................ 32

Commercial Organization ..................................................................................................... 32

Volume Forecast ................................................................................................................... 36

Gross Revenue Share Forecast.............................................................................................. 40

IV. DETAILED CAPITAL INVESTMENT PLAN.................................................................... 41

Port of Virginia Development Plan....................................................................................... 41

Capital Maintenance Improvements ..................................................................................... 42

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Capital Expansion ................................................................................................................. 43

Obligations for Capital Expenditures.................................................................................... 46

PART 2 b – FINANCIAL PLAN ................................................................................................. 47

I. FINANCIAL PLAN .............................................................................................................. 47

Funding the Transaction and Future Capital Investments .................................................... 47

Financing Roles .................................................................................................................... 47

Minimum Financial Requirement ......................................................................................... 48

Appendix I: Financial Information Form

Appendix II: Annual Volume Forecast

Appendix III: Debarment Certification

Appendix IV: Compliance with Law Certification

Appendix V: Proposer Ownership Certification

Appendix VI: Guarantor Financials

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PART 1 – QUALIFICATIONS

I. UNIFYING THE PORT OF VIRGINIA

APM Terminals presents this proposal to undertake the operational responsibility for the Port of Virginia’s owned facilities of Norfolk International Terminal (NIT), Newport News Marine Terminal (NNMT), Portsmouth Marine Terminal (PMT) and Virginia Inland Port (VIP). These are diverse facilities including modern, traditional, general cargo and inland port locations. In addition we intend to contribute the ownership of our proprietary facility, APM Terminals Virginia (APMTVA), and operate that facility on behalf of the Virginia Port Authority. Over the term of the agreement, as concessionaire, APM Terminals will finance, operate, maintain, and improve port facilities.

APM Terminals will unify ownership of the Port under the Commonwealth using a landlord port authority model, a widely used platform for port operations in the United States and around the globe. Unification of the Port is a prerequisite to fully meet the Concession Objectives and the long-term goals of the Port’s Master Plan.

Concession Objectives:

(a) to establish the Port as the leading ocean container terminal complex in the Mid-Atlantic region by increasing cargo volumes through the Port;

(b) to establish the Port as the first choice for discretionary cargo bound for the Midwest; (c) to implement best practices that promote operations that are eco-friendly, efficient, and

cost effective; (d) to make capital investments in Authority facilities; (e) to foster economic growth in the Commonwealth and the communities that currently

support the Port; and (f) to enhance the tax base of the Commonwealth and its political subdivisions.

APM Terminals’ proposal releases the economic generating powers of the Port for use in expanding the regional economy rather than being consumed within the gates of the Port.

This singular capital and operational management plan will optimize the resources of the Port of Virginia to ensure development and growth happen in the right place, at the right time and in the most cost effective manner. At the same time, our proposal transfers the business risk for these investments from the Commonwealth to APM Terminals.

As a global operator with strong local ties and global experience with the qualifications sought by the Commonwealth, APM Terminals is superbly qualified to present this value proposition to the Commonwealth.

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II. APM TERMINALS GLOBAL ORGANIZATION AND PORTFOLIO

APM Terminals operates a global terminal and inland facilities network comprised of 25,000 employees in 67 countries, including interests in 63 port and terminal facilities and 160 Inland Services operations. APM Terminals provides port management and terminal operations services to more than 60 shipping lines.

APM Terminals was established as an independent division within the A.P. Moller-Maersk Group (APMM) in 2001. APM Terminals moved its corporate offices from Denmark to The Netherlands in 2004.

In 2011, APM Terminals handled 33.5m TEU, ranking as the third largest container terminal operator in the world. Most importantly, APM Terminals is dedicated to business practices that meet the highest ethical, environmental, and socially responsible standards.

APM Terminals is the only operator which offers the global shipping community a geographically balanced, integrated global terminal and inland network.

Global Terminal Network

Our Global Terminal Network includes operations in 63 terminals in 40 countries including six new terminal development projects and 14 expansion programs currently underway.

APM Terminals is organized into four global Regions - The Americas, Europe, Africa/Middle East, and Asia Pacific. This regional structure allows for accelerated decision-making and execution and ensures APM Terminals has closer relationships to regional customers and markets.

APM Terminals also operates 60 Inland Services Companies in 160 locations throughout 48 countries. Inland Services includes cargo support, inland transportation and depots, equipment maintenance and repair, and container lifecycle management. Inland Services provides APM Terminals with experience beyond that of normal terminal operators.

APM Terminals understands the importance of seamless interaction between terminals and related industry segments. This experience enables APM Terminals to work closely with the VPA to provide services necessary to expand manufacturing, warehouse and distribution centers reliant on the Port of Virginia, specifically the Virginia Inland Port in Front Royal.

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APM Terminals Americas

The Americas Region, headquartered in Portsmouth, VA, manages all APM Terminals activity for North and South America. The Americas Region is presently comprised of 13 port and 39 Inland Services locations in 13 countries.

APM Terminals has also committed approximately $2 billion of capital to three additional terminal development projects currently underway in the Americas Region. Investments such as these demonstrate APM Terminals’ ability to meet the required qualifications as the Concessionaire.

APM Terminals Virginia

APM Terminals’ operation of PMT and subsequently our development and operation of APMTVA has given APM Terminals direct, relevant experience working with the VPA and the Virginia business community.

In 2007 we opened APMTVA on the former Cox property along the Elizabeth River. Our substantial history underscores APM Terminals’ commitment to a long-term presence in the Port of Virginia and our ability to operate terminal facilities in Virginia’s distinct business environment.

At a total cost of $540 million, APMTVA represents the largest private port investment in the United States. This investment exemplifies APM Terminals’ capacity to finance and execute infrastructure investment. Such investment also served as an expansion of the local tax base.

At the time of its opening, and continuing today, APMTVA’s design is the most advanced in the North America. Key on-terminal activities are fully automated and others are remotely conducted from a centralized terminal operations center. This promotes efficiency, accuracy, and worker safety.

APM Terminals worked closely with the VPA and numerous state agencies to bring this facility to life. The partnership also led to the completion of the largest private dredging project in US history and the construction of the APM Terminals Boulevard Interchange, a highway overpass providing truck access to the terminal.

APMTVA also delivered on-dock rail access to both the CSX and the NS railroads, a first in the Port of Virginia. The terminal is designed for the future of international shipping with cranes and

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quay walls that can serve super-post-Panamax vessels, a 50’ navigation channel, direct access to the interstate highway system, and double-stack intermodal service.

During construction, APM Terminals demonstrated its commitment to operating in an environmentally responsible manner by:

• Preserving 130 acres of forested wetland through deed restrictions • Developing 17 acres of tidal wetlands and two storm water retention ponds • Installing approximately 200,000 new wetland plants and seeding an additional one

million clams in local clam beds • Developing underground retention and storage of storm water for fire protection • Deploying electrified ship-to-shore and rail mounted gantry cranes to reduce emissions • Deploying automated systems to reduce lighting requirements • Using approximately 225,000 cubic yards of recycled aggregate for pavement sub-base,

saving landfill space

III. EXPERIENCE AS A SINGLE OPERATOR

We are the single port operator in 13 of our 63 locations worldwide (21%). This is in line with the industry ratio seen in the top 150 global ports (25%). APM Terminals has direct and relevant experience in the financing, operation, maintenance and improvement of these port facilities. APM Terminals successfully handles over 5.5m TEU annually in these locations while serving numerous international shipping lines. Five examples from our portfolio are provided below to highlight the experience and qualifications we will bring to the Port of Virginia.

Mobile, Alabama

In January 2006, APM Terminals signed a 30-year concession with an optional 10-year extension agreement with the Alabama State Port Authority (ASPA) to be the sole operator of the state’s only container port in Mobile. Part of the agreement was to fund ($200 million), construct and operate a new marine terminal on a “green field” site. Since opening in October 2008, APM Terminals has secured new services from ZIM Lines, APL, China Shipping, CMA CGM, Hyundai Merchant Marine, Maersk Line, MSC, and UASC.

Through the efforts of APM Terminals’ local and regional team, the port has achieved double-digit growth each year since 2009 including a 30% growth rate for 2011 and 29% for 2012 year-to-date, making Mobile the fastest growing port in the United States over that period. Also during this time period APM Terminals has increased vessel productivity to more than 32.7 Gross Moves Per Hour (GMPH).

James Lyons, the Director and CEO of the ASPA, affirmed “a single operator port did not create an unfair competitive advantage” and “more importantly [APM Terminals] work(s) closely with our trade and marketing staff to better position our state and seaport in the global marketplace”.

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An illustration of what Mr. Lyons refers to is our recent transaction with MSC and Georgia Pacific. APM Terminals established a value proposition directly with Georgia Pacific that convinced their shipping line provider, MSC, to move a service to Mobile to handle Georgia Pacific’s business. The success of this arrangement has helped Georgia Pacific reduce costs and grow their business. Since the transition of this initial service, MSC has continued to expand their market presence with a larger customer base and has subsequently increased port calls in Mobile.

Gothenburg, Sweden

In early 2012, APM Terminals took operational control of the formerly state run port, a straddle carrier container terminal, in the Port of Gothenburg – Scandinavia’s largest container port. In less than one year of operations APM Terminals has secured additional Asia-Europe services from the G6 Alliance, which is in direct competition with Maersk Line in this market. This commercial effort has helped the port increase market share and to achieve a volume record for the first six months of 2012, despite a very weak market in Northern Europe.

In this same period, we have invested in training programs and implemented APM Terminals programs for Safety and Process Excellence, resulting in improved vessel productivity of more than 6% from 22.7 to 24.1 GMPH. Further improvements we have identified will deliver a GMPH of 28.8 by the second quarter of 2013, an increase of more than 25% compared to performance at the time APM Terminals took operational control of the existing facility.

Aqaba, Jordan

Since 2004, APM Terminals has operated the only port in Jordan. Under our management volume has grown by approximately 150% and discretionary hinterland cargo beyond Jordan’s borders by 63%. In Aqaba we serve 15 of the world’s top shipping lines and we have created more than 700 local jobs in the process. The volume growth has predominately come from customers such as APL, China Shipping, CMA CGM, COSCO, Evergreen, Hanjin, Hapag-Lloyd, PIL, UASC, and Yang Ming.

APM Terminals is currently executing a $200 million expansion project to increase container capacity to 2 million TEU and support general cargo operations in the port.

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Salalah, Oman

APM Terminals has managed the operations at the Port of Salalah since its opening in late 1998. We have overseen significant construction and expansion projects, most recently in 2008 with the addition of 3,150 feet of berth and 81.6 acres of container yard designed for RTG operations.

APM Terminals has secured the world’s second largest container shipping company, MSC, for Salalah, along with several other international shipping lines. Through collaboration on a local and global level, we have helped MSC grow its market share from 17% in 2008 to approximately 50% in 2012, overtaking Maersk Line as the Port of Salalah’s largest customer.

In Salalah, like other facilities in our global portfolio, we also operate the bulk, break bulk, and liquid bulk facilities in addition to the container terminal in the port. In these facilities we provide a full range of services, similar to our proposal for the Port of Virginia.

Monrovia, Liberia

In 2010, APM Terminals was chosen to rebuild Liberia’s port in Monrovia. This is the sole port in the country and it plays a vital role in Liberia’s economic redevelopment. The 25 year concession includes investment of approximately $120 million to rehabilitate the quay, purchase new equipment, develop gate facilities, and conduct other modernization projects to transform the port into a more competitive terminal in the region. APM Terminals is also investing the local community, working with city and country officials to improve sanitation and education for citizens.

Immediately after takeover, APM Terminals revised cargo collection and clearing processes to improve cargo flow and productivity for the port community. This is just one effort that has helped bring business to Liberia, resulting in volume increases of 30% in each of the first two years of operation.

Additional Single Operator Locations

In addition to the five highlighted locations above, APM Terminals acts as the single operator in the following locations:

• Aarhus, Denmark • Abidjan, Ivory Coast • Bahrain, Kingdom of Bahrain • Douala, Cameroun

• Pipavav, India • Pointe Noire, Congo • Poti, Georgia • Tema, Ghana

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Global Operators Rankings Simulated Global Operators RankingsRank Operator mill. TEU Rank Operator mill. TEU

1 Hutchison Port Holdings 50.2 1 Hutchison Port Holdings 50.22 Port Singapore Authority 40.8 2 Port Singapore Authority 40.83 APM Terminals 33.5 3 DP World 33.14 DP World 33.1 4 APM Terminals* 15.55 Cosco Group 15.4 5 Cosco Group 15.4

(*) excluding Maersk Line volumes

IV. PRINCIPLES OF THE APM TERMINALS BUSINESS MODEL

APM Terminals instills our culture of safety, productivity and efficiency, global commercial relationships, innovative technology, and environmental responsibility wherever APM Terminals does business.

Safety

APM Terminals’ goal is zero fatalities and zero incidents. The commitment applies not only to employees, contractors and sub-contractors, but extends to third party visitors. APM Terminals’ responsibility is to ensure that all who work on or visit our terminals return home safely to their families at the end of each day. Safety is our first priority and the subject of global, regional, and local programs. We are recognized by all as the industry safety leader. The programs we employ in pursuit of our safety priority are discussed in more detail in the Detailed Operations and Maintenance Plan.

Global Commercial Relationships

Our commercial approach and customer service are cornerstones of the APM Terminals organization. We employ a network of professionals strategically based around the world in key shipping industry locations such as New York, Rotterdam, Panama City, Shanghai, Hong Kong, Singapore and Dubai. This network of colleagues allows APM Terminals to serve over 60 shipping line customers worldwide, and numerous beneficial cargo owners (BCO’s).

Our dedicated commercial focus has secured APM Terminals’ status as a truly independent terminal operator as defined by Drewry Maritime Advisors. It is worth noting that APM Terminals is not placed in Drewry’s Global Hybrids category, which comprises terminal operators who are affiliated with a shipping line. APM Terminals is specifically recognized as a independent operator because of a “clear distinction between terminal operating business and liner business.”

APM Terminals is non-discriminatory in its approach towards container lines. This is reflected in our diversified customer base and rapid expansion over the past decade.

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APM Terminals ranks as the world’s third largest port operator, handling 33.5 million TEU in 2011. APM Terminals handled approximately 15.5 million TEU from our customer base outside of Maersk Line in 2011, a volume total which would still place fourth largest in the world.

Since 2006, APM Terminals has increased the share of non-Maersk Line customers from 30% to 50% as of Q3 2012. Over that period we have grown non-Maersk Line volumes at a rate of

greater than 12% per year, more than twice the global growth rate for the industry.

In the Americas Region, 57% of our volume comes from customers other than Maersk Line. Our goal is to diversify even further.

These growth rates are only possible because APM Terminals continues to increase business through valued relationships with the world’s shipping community. In addition to traditional terminal arrangements, we employ creative solutions to develop commercial relationships with our customers, resulting in more productive relationships.

For example, in the Port of Miami we are partnered with CMA CGM’s terminal company, as co-shareholders in South Florida Container Terminal. We have also partnered with MSC’s operating arm in Santos, Brazil where we are set to open South America’s largest container facility next year. More recently, a consortium consisting of APM Terminals and MSC’s operating unit, among others, have joined forces to announce an ambitious future development of a new mega-port and free trade zone project in Lagos, Nigeria.

In Los Angeles, APM Terminals and Hyundai Merchant Marine (HMM) created a partnership whereby HMM moved from their own dedicated terminal facility into our Pier 400 facility. As part of the agreement we carved out a dedicated space allocation for HMM to operate their own business utilizing our equipment and footprint. This has created a successful and unique value proposition to both organizations.

Productivity

The most tangible measure of the operating relationship between a port and its shipping line customers is vessel productivity. By combining targeted capital investment and a systematic approach to operational process improvement, APM Terminals will provide the reliable productivity required to effectively serve the world’s leading shipping lines. The core focus on vessel productivity as a key driver of our operational success is part of our DNA.

In the past year, APM Terminals has become increasingly vocal about the need for the industry to start challenging what have become the acceptable norms for vessel productivity. Starting at

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the beginning of the year, the Americas Region has had a targeted effort to improve vessel productivity across our portfolio of terminals. As a result, the average number of moves per crane per hour is currently 4.5% greater than it was in 2011. At the same time, the average number of moves per vessel per hour has increased by over 9.5%. This latter measure, known as berth productivity, is particularly relevant as vessel sizes increase in the coming years.

Our new terminal in Callao is an illustrative example of our ability to immediately impact vessel productivity thereby improving customer service levels and increasing the port’s throughput capacity. APM Terminals was awarded the concession to operate the previously state-run port in the second half of 2011. In the short time since we have had management control of the facility, the ship-to-shore crane production (moves per hour per crane) has increased by more than 27%. This outstanding increase is driven by our ability to harness our global expertise to drive on the ground operational improvements that benefit the Port, the customer and APM Terminals.

Innovation and Technology

Innovation plays a key role in ensuring port operators stay at the forefront of competition. Innovation and technology makes our business safer, more environmentally friendly and helps control costs. APM Terminals has a specialized team dedicated to establishing innovative technology. Working with companies in the port industry as well as unrelated industries, we pride ourselves on our innovative spirit. In 2011, a crane concept designed by APM Terminals was recognized for our innovation efforts at the 23rd Annual Seatrade Awards, taking home the “Innovation in Ship Operations”. The FastNet crane, a project in development since 2007, is patented in multiple countries throughout the world.

APM Terminals is pushing the boundaries of innovation even further by changing the scope of an order for Lift-Automated Guided Vehicles (Lift-AGV) from diesel-electric powered to fully electric battery powered units. APM Terminals Maasvlakte II, in Rotterdam, has placed an order for 37 Battery-powered Lift-AGVs, 87 battery packs and two, robotic Battery Exchange Stations, allowing automated exchange of the battery pack.

Environmental Responsibility

Improving environmental performance is an essential dimension of APM Terminals’ sustainability efforts. In 2011, APM Terminals prioritized the following environmental aspects associated with its operations and activities: climate change, soil contamination, biodiversity, and hazardous spills. APM Terminals has set a target for its terminals of 25% reduction in CO2 emissions per TEU by 20201.

1 Compared to 2010 baseline.

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Specific examples of APM Terminals working towards achieving this goal include:

ECO-RTGs

In cooperation with Siemens AG of Germany, APM Terminals has developed improved rubber tired gantry crane (RTG) technology which can increase efficiency and reduce diesel fuel consumption by as much as 40%.

ECO-RTGs employ a variable speed drive and diesel engine energy hybrid management system which optimizes energy utilization and benefits users through reduced fuel costs, emissions, noise and fumes. The reduction in diesel fuel consumed produces commensurately lower levels of carbon dioxide, particulate matter, and other harmful emissions.

Hybrid Yard Trucks

Together with the Environmental Protection Agency (EPA), Kalmar, Parker Hannifin, and other parties in the United States, APM Terminals piloted a hydraulic hybrid yard tractor. This new application of a proven technology reduces air pollution, creates fuel savings of up to 40% and represents potential lower operating costs. By compressing gas in a hydraulic cylinder, the hybrid system captures and stores braking energy for reuse during acceleration, much as an electric hybrid stores energy in a battery for later use.

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V. INDUSTRY RECOGNITION

While we are proud to share examples of our business success, we are particularly proud of those achievements being recognized by leading Industry associations:

Lloyds List’s Global Awards “Port Operator of the Year”

APM Terminals was named “Port Operator of the Year” for 2012 by a panel of industry judges. APM Terminals also won this award in 2009.

The award is given in recognition of “the company or port authority that has maintained the highest standards of operational efficiency and customer service throughout the year” through “exceptional innovation, improved efficiency, profitability or successful investment in port operations”. APM Terminals’ commitment to sound growth based upon the highest standards of ethical and sustainable business practices and local community involvement were cited by the judges in their selection of APM Terminals.

Containerisation International Awards “Terminal Operator of the Year”

APM Terminals’ “ongoing investment programs at its terminals and its ability to implement and adapt very effectively global safety, security and environmental guidelines at the local level” as well as APM Terminals’ “success in combining development with continuous improvements in its Corporate Social Responsibility and environmental policies” were cited by the judges when awarding APM Terminals the 2012 award.

Lloyds List’s Global Awards “Global Safety Award”

APM Terminals was named winner of the 2011 Lloyd’s List Global Safety Award. The award was presented in recognition of APM Terminals’ “exceptional commitment to improving safety standards” during 2011.

Signal Mutual Gerald H. Halpin Safety Excellence Award

In 2012, APM Terminals’ U.S. operations’ overall safety performance earned APM Terminals the Signal Mutual Gerald H. Halpin Safety Excellence Award for 2010-2011, Signal’s highest accolade. The award is given in recognition of the Signal Member company which has best exemplified the promotion of employee safety and health throughout their organization.

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PART 2 a – BUSINESS PLAN

I. EXECUTIVE SUMMARY

APM Terminals shares the Commonwealth’s objectives as outlined in the Instructions to Proposers. As an experienced global port and terminal operator, APM Terminals will meet the Concession Objectives by working with the Virginia Port Authority, the Commonwealth, and other stakeholders in the Port community. With a documented record of success as a port operator, APM Terminals offers strong financial backing and will bring industry-best practices in safety, operations, maintenance and port development to the Port of Virginia facilities.

Proposal Overview

The fundamentals of APM Terminals’ Financial Offer continue to reflect the Unsolicited Proposal submitted in April, 2012. However, APM Terminals can now provide a more accurate picture of the benefits to be provided. Below is a financial summary of the 48-year proposal.

Financial Benefits to Commonwealth 48 – Year Proposal

NPV* $ Millions

Upfront Payment2 395

Fixed Monthly Payments 952

Revenue Share3 660

Tax Payments4 515

Capital Investments 1,062

Residual Value APMTVA 237

Total Value 3,821 * Values estimated per latest APM Terminals forecast, discount rate 5%

This proposal will advance the mission of the VPA by assuring an amalgamation of port ownership by the Commonwealth in perpetuity, a predictable annual cash flow to the VPA, and private capital injection into port development and expansion.

These benefits begin accruing immediately upon implementation of a long-term concession contract, and will continue well after expiration of such agreement through the benefits of a unified Port of Virginia.

2 Includes the Concession Fee and market value of contributed assets 3 4% of revenue less pass through charges 4 Includes income tax, personal property tax, and sales tax on equipment purchases

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Operations and Maintenance Plan

At the foundation of the Operations and Maintenance Plan are two strong aspects of the APM Terminals organization: Safety and Process Excellence. We are already recognized as the leader in safety performance within the port industry and our commitment to safety for our employees and visitors to our facilities around the world is unparalleled. Through our Process Excellence program our employees are continuously improving in all aspects of the business through data analysis, effective decision-making, and best practice sharing.

Vessel Operations

Vessel productivity at APMTVA and NIT has fallen below 2009 performance and APM Terminals will prioritize the recovery of this lost potential. We have many productivity success stories from our global portfolio where we have documented results of our dedicated professionals collaborating with customers and stakeholders based on data-driven decision-making. Working with stevedoring companies, shipping lines, and vessel crews, we are meeting the challenges of servicing larger vessels in shorter time frames.

• Best practices from the APM Terminals global network • Upfront Concession Fee and increased payments over the first 5 years to

help fund VPA financial obligations • Predictable operating cash flow for VPA to eliminate any market

exposure • Increased total municipal tax base to help defray the costs of managing

the cities • Frees up cash for investment outside of the Port's gates

Immediate Benefits

• Certainty of the location and capability to expand the Port in the most efficient manner (APMTVA Phase II) thus keeping user costs low and operating performance high

• Significant private capital to fund superstructure needs and other investment programs

• Port development expertise of a leading global terminal operator

Mid-term Benefits

• The VPA is assured control of all capacity in the Port • Reduced risk profile for VPA cash flow, particularly as it pertains to the

period after the current APMTVA lease ends • Continued modernization of the Port to expand capacity and grow market

Long-term Benefits

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Yard Operations

Yard strategies are the heart of terminal operations and APM Terminals uses advanced systems, data analysis, and real-time information to ensure operations in the container yard support service requirements for vessel, gate, and rail operations. Technology is growing in importance and reliability in the port industry, and APM Terminals is working with vendors, manufacturers, and advisors to be at the forefront with innovations such as electric RTG’s which reduce emissions by more than 44% compared to a standard RTG.

Rail Operations

Rail operations in the Port will promote the Port of Virginia as the first choice for discretionary cargo bound for inland markets. Experience with on-dock rail facilities runs deep within APM Terminals, particularly in North America where terminals in Elizabeth, Houston, Los Angeles, and Tacoma all work with on or near dock rail operations. Through process revisions and expansion plans, APM Terminals will nearly double the existing rail capacity in the Port of Virginia.

Maintenance

Equipment and facilities maintenance standards within APM Terminals are given great importance as both can directly contribute to improved production and safety performance. We adhere to maintenance schedules provided by original equipment manufacturers and through lessons learned apply improved preventative maintenance procedures for some equipment. For facilities maintenance, APM Terminals complies, at a minimum, with local, state and federal law for safe use and extended lifetimes.

Marketing Plan

Making the Port of Virginia the leading container terminal complex of the Mid-Atlantic region will be achieved by capturing market share. Ports that compete for Virginia’s local cargo, such as Baltimore and Wilmington, which combined handle around 1 million TEU annually, provide excellent opportunities for growth. Further penetration of the Southern states and growing populations areas such as Charlotte and Greater Atlanta region, presently served primarily via Savannah and Charleston, will also be targeted.

By leveraging our experience with on-dock rail operations, APM Terminals will work with rail service providers in the Port of Virginia to offer a competitive product. As the terminal operator we will maintain flexibility in our operations for loading and unloading the inbound and outbound trains to eliminate unnecessary idle time between the container yard and the railcar.

Operational best practices for planning, staging, loading and unloading trains will be implemented at each facility as part of the Operations Plan. With strong working relationships

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and stronger product offerings, the Port of Virginia will be well positioned to become the first choice for discretionary cargo bound for the Midwest.

Commercial Organization

APM Terminals is a worldwide operator capable of implementing a far reaching commercial platform to customers throughout the globe. Our team of Global Account Managers regularly meets with key customers to discuss future business plans and outline strategies for meeting their service needs.

Locally, APM Terminals will have a dedicated group of professionals based in Virginia focused on contracting, establishing Terminal Service Agreements and providing world-class customer service.

One of the synergies created through this partnership with the VPA is our ability to combine resources to leverage Virginia’s value proposition to create immediate, mid-term and long-term commercial leads for the Port. A unified commercial front between concessionaire and Port Authority will be a distinct value for the Port of Virginia compared to competing ports.

Volume Forecast

A base case and an optimistic case have been established. APM Terminals envisions being able to capture between 5% and 10% in additional market share over the term of the concession.

There will be extensive competition along the East Coast as bigger ships enter the trade lanes. Competing port investments in infrastructure, including navigational projects, will intensify the effort to secure additional discretionary cargo. We will position the Port to win this competition.

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Base Case Optimistic Case

CAGR 4.0%(17% Mkt share)

CAGR 5.0%(22% Mkt share)

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Capital Investment Plan

Based on our current forecast for volume growth, utilization levels, evolution of best practices and market conditions, we estimate that significant capital expenditure will need to take place over the course of the concession period.

Capital Investment Forecast Nominal $ Millions

30-Year Proposal

40-Year Proposal

48-Year Proposal

APMT Investment 796 2,370 3,380

VPA Investment 920 163 45

Total Value 1,716 2,533 3,425

These investments will ensure the Port facilities are maintained to the highest operational and ecological standards. The development of APMTVA Phase II and modernization of NIT and the other facilities will provide the capacity expansion necessary to handle the growth for decades to come.

Financial Plan

The split of investments proposed follows the typical landlord-tenant model. APM Terminals will undertake the superstructure investments and the VPA remains responsible for infrastructure. Nuances to this model will vary depending on the life of the term acceptable to the VPA. APM Terminals has a demonstrated capability to fund the investment amounts required to ensure the Port of Virginia remains a preeminent facility on the East Coast. As a business unit of the APMM Group we have a strong financial position and have provided bank references in our original Unsolicited Proposal. Through this proposal, limited funds should be required by the VPA and no federal funding is required. APM Terminals understands the current debt obligations of the VPA and would work with the Authority to find optimal solutions to minimize the cash outflow to service those debts. Declaration of Intent

If recommended by the Commonwealth and designated by the Authority’s Board as a Preferred Proposer for the PPTA Process relating to the Port of Virginia, APM Terminals is fully committed to and will negotiate towards the delivery of a Comprehensive Agreement.

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II. DETAILED OPERATIONS AND MAINTENANCE PLAN

The Operations and Maintenance Plan outlines key elements associated with the terminals in Hampton Roads (APMTVA, NIT, NNMT and PMT) and Front Royal (VIP).

With more than 60 terminals around the world, APM Terminals has a tremendous database of operating procedures, processes and best practices that will be readily accessible to the teams working in Virginia. From straddle carrier operations to advanced terminal developments incorporating automation and technology, APM Terminals has an experienced team that will augment the existing employees of the Port of Virginia facilities.

Safety and Process Excellence are two core aspects of APM Terminals at the root of our Operations and Maintenance Plans. Both are foundations for continually improving our behavior, communication, execution and performance as an industry leading terminal operator. APM Terminals will initiate these programs early in the transition of operating control in the Port of Virginia.

Safety

The APM Terminals Safety Program is built on a foundation of Continuous Improvement not only in the determination to keep all persons on our facilities safe, but to seek seamless integration of safety with all operations activities. Positive indication of the success of this premise is APM Terminals Mobile operating with zero Lost Time Incidents (LTI) for nearly three years, South Florida Container Terminal in Miami operating for over 400 days without a LTI and high volume facility Port Elizabeth, NJ operating for over 160 days without a LTI.

In the port industry, APM Terminals is the recognized leader in safety performance and our historical performance has consistently distanced us from the competition.

Compliance with regulatory requirements and conformance to an OHSAS 18001 safety management system are important to our quest for Continuous Improvement. All APM Terminals facilities must submit an annual Safety Improvement Plan and successfully complete the outlined initiatives. This plan includes compliance and conformance components as well as the Drive to Zero reduction in Lost Time Incidents and High Severity incidents.

In addition to the Signal Mutual Halpin Award APM Terminals has been recognized for several other terminal specific awards. For 2011 performance, the Pacific Maritime Association awarded

0

10

20

30

40

50

60

2005 2006 2007 2008 2009 2010 2011

APM Terminals Port Industry by TT Club, London

(per million hours)Lost Time Incident Frequency

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APM Terminals with the first place award for Safety for Container Class A Terminals for both Southern California and the West Coast. This was APM Terminals’ fourth consecutive year winning those awards. Additionally, the South Carolina Stevedore Association awarded APM Terminals Charleston its 2011 Safe Performance Award for lowest OSHA recordable incidents.

APM Terminals supports its high expectations for performance excellence in safety with training not only in the form of orientation for visitors, vendors and contractors, but with all employees and labor. The Global Safety Workshop has been carried out at every facility in our system to raise awareness for safety and strengthen the safety culture globally. Additionally, newly hired employees receive specific safety training and all safety professionals are required to participate in continuing safety education.

Global Minimum Requirements (GMR) relating to safety processes, employee training and equipment specifications will be applied anywhere we handle containers, laden or empty. Within 30 days of gaining operational control, APM Terminals will audit each facility to determine corrective action steps to ensure GMRs are met.

Safety at APM Terminals holds such significance in the Americas Region that it is overseen by the Americas Safety Council with AMR President Eric Sisco as Chair and other senior leadership serving as committee members. Globally, Safety Activist Martin Poulsen acts on behalf of APM Terminals President and CEO, Kim Fejfer as the Head of Global Safety. The Virginia operations will fall under this governance structure, but would have a robust safety team and culture on the facilities to work on local initiatives. In Virginia, our ambition will be to build upon existing safety initiatives, utilizing our global practices and experience in problem solving trouble areas.

Process Excellence

APM Terminals deploys a combination of Lean and Six Sigma (LSS) concepts and tools to Define, Measure, Analyze, Improve and Control (DMAIC) the processes that drive our business activities. This Process Excellence initiative has delivered improved service and reliability to our customers around the world. We have applied this methodology in situations similar to Virginia where performance has been declining, most recently in Gothenburg, Sweden. Our first year business plan will include implementing Process Excellence to combine the existing team in the Port’s facilities with our global and regional team of experts, creating a prioritized list of projects and address those expeditiously.

The Process Excellence approach provides a culture shift in the organization and empowers individuals and teams to work with a mindset of Continuous Improvement. Some example project categories include:

22

Vessel Productivity

Gate Transaction Efficiency

Yard Planning Strategy

Shift Start/Stop Processes

Voice of the Customer

Safety

Transport Equipment Efficiency

Yard Equipment Productivity

Visual Management techniques are successfully deployed in APM Terminals facilities around the world, contributing to a clear understanding of goals, accomplishments and work instructions to staff. In this fact-based and data-driven environment the terminal organization is able to focus on aspects of the business that matter most to achieve success.

A practical example of our Process Excellence approach comes from Houston, where a customer requirement for higher vessel productivity prompted a cross-functional team to analyze data, observe current processes and develop an action plan to improve the productivity. An increase of approximately 12% improvement to GMPH was realized when the terminal adjusted the yard strategy to better coincide with vessel, gate and rail cargo schedules. New processes to better control the flow of external truck traffic and separate these trucks from vessel activity were also introduced. This project also delivered a 41% decrease in the truck turn-time for import deliveries, thus improving service on both the water and land side of the operation.

In 2011, APM Terminals launched an initiative called Global Transformation. This program is tasked with bringing more advanced Process Excellence thinking and data diagnostics techniques to the terminals to further improve productivity and efficiency. Best Operating Practices from around the globe are being actively shared and will result in the creation of a set of

Global Standards. These standards can then be the focus of the Continuous Improvement journey. The APM Terminals pool of certified LSS Black Belt employees, who are all well versed in terminal operations, will educate and coach terminal staff, guide improvement projects and facilitate data analysis. As a result, container terminals in the Port of Virginia will more consistently deliver service that customers can rely on.

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Operations Plan

Vessel Operations

APM Terminals is considered an industry leader in our approach to vessel operations. With multiple terminals performing consistently in excess of 40 gross moves per hour (GMPH) both abroad and in the United States, APM Terminals has the experience and expertise to improve performance in Norfolk and Portsmouth. Vessel productivity at APMTVA and NIT has fallen in 2012 compared to the results from 2009 and we will make it a primary objective to recover this lost potential.

In the Port of Virginia the vessel stevedoring (container loading and unloading) activities are performed via third party companies, namely CP&O and CERES. This requires close cooperation of planning yard and vessel movements. APM Terminals looks forward to working with these companies to jointly continue providing safe, cost competitive, productive and reliable service to the steamship lines.

To ensure safe production and reliable service, APM Terminals will engage with the stevedore operators to review plans and performance results to capitalize on opportunities for improvement. Given the segregation of services between APM Terminals and the stevedores it will be critical that all operational handoffs and information interfaces are well coordinated and planned efficiently. First, we will review the current process flow, removing waste and minimizing bottlenecks. Additionally, it will be important that the expected deliverables from each side are defined and aligned and that the appropriate metrics are put in place to measure existing performance and track improvements. Given our experience in the Port of Virginia, APM Terminals understands the traditional role of terminal operator as well as the stevedore segment of the operation. This will allow us to better manage the end-to-end process with all service providers.

Through Process Excellence projects our facilities use data to perform advanced diagnostics on operations to identify opportunities to improve performance. At a major facility in our Europe Region, data showed that the terminal could improve vessel productivity by 2.8 GMPH by altering the yard strategy to support more effective truck movements. In conjunction with other adjustments that started in May of 2012, the results, shown in the figure below, have exceeded expectations.

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Optimizing vessel productivity in Virginia requires the combined effort of not only the terminal operator and stevedore, but also the shipping line. The line’s planning and stowage is a key driver of productivity. Our intention is to initiate an ongoing dialogue with carriers to discuss these issues both on a vessel-specific and trend line basis. This practice has proven successful at other locations, such as Rotterdam, Tanjung Pelepas, Port Said and Zeebrugge, helping to improve customer communication at the appropriate operating level and deliver value in the form of reduced port stays and better load factors. As vessels typically call multiple ports along the East Coast with tight schedules, our ability to ensure port stays in Virginia are efficient will allow for the faster turn-around of vessels to maintain schedule integrity and/or deliver slow-steaming opportunities for reduced fuel consumption. This reliability developed through our Continuous Improvement efforts will draw more business to the Port of Virginia and provide the shipping lines an incentive to increase per call throughput.

While vessel productivity will not be solely under the direct control of APM Terminals it is critical to the Port’s ability to compete for freight and therefore must remain a key focus of APM Terminals’ management team.

Yard Operations

One of the core success factors in a terminal operation is a well-planned and well-run container yard. Because it is so central to all other aspects of the facility operations, APM Terminals will deploy a yard strategy that is dynamic to the circumstances of the cargo and customers serviced in the Port of Virginia. Our team of professional operators will analyze cargo trends, review forecasts for gate, vessel and rail traffic to dynamically alter the yard strategy to support safe and productive operations.

The short to medium term challenges likely to be faced managing the yard operations at the Port of Virginia will result from the complexities of increased throughput and densities. As volumes increase and vessel call sizes grow, we will be required to move greater numbers of containers through the terminals in shorter periods of time. The physical layouts of the facilities can be

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improved over time and, as noted in this bid document, we have planned for substantial capacity expansion.

The Port currently benefits from a number of factors to help cope with the growing volumes, including the substantial use of a common chassis pool and the off dock empty depots. These two items will likely continue under an APM Terminals concession albeit with a more intense focus on cost controls. Even given these advantages, APM Terminals will deploy a more sophisticated approach to yard management to be more effective in the future operating environment.

As evidenced by the state of the art Terminal Operating System (TOS) developed and deployed at the APMTVA facility, we believe strongly in a technology-aided approach to managing container and equipment inventory. This does not necessarily require greater automation of container movement. As evidenced by our Process Excellence and Global Transformation programs, it can be achieved through an analytical, data driven approach to the placement of containers, the sequence of container movements and the real-time tracking of these activities.

We plan to modernize many of the existing paper and pen processes that are employed today to support our growth aspirations. In simple terms, some of the advanced planning techniques and container tracking capabilities employed in our APMTVA facility will be carefully deployed throughout the Port of Virginia. The upgrade that the VPA currently has planned for the terminal operating system will provide an opportune time and platform to move forward in this regard.

By tracking equipment and container movements we will create a large data set that can be analyzed to promote effective decision-making. Our goal is to minimize the number of times a container is handled during its time in the terminal while still supporting productivity objectives for customers at the gate, rail, and berth.

Yard expansion at APMTVA is set to double the overall capacity by constructing 15 additional RMG blocks. As part of the Phase II expansion plan many details are similar to the existing setup. However, the design will be reviewed prior to the commencement of construction activities. One likely change is the inclusion of more racks for live refrigerated containers to provide more options for handling and storage while meeting the demand for reefer capacity as volumes grow.

A simple yet effective means of increasing the yard capacity is to operate 1-over-3 straddle carriers, increasing the operational stacking height by an estimated 35%, bringing the throughput

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capacity to an estimated 2.29 million TEU5. The yard at NIT will require further investigation to determine if the pavement is capable of supporting higher stacks of laden containers to support RTG’s or even RMG’s. It is estimated that by applying APM Terminals’ world class RTG layout standards the TEU throughput capacity at NIT could reach 3.27 million per annum. APM Terminals is fully prepared to engage in discussions with the VPA to determine the best course of action for Virginia and the NIT facility.

Gate Operations

Truck entry and exit points are a critical element of daily terminal operations success. Technology plays a key role in managing the data associated with gate moves and will continue to do so in the future setup of APM Terminals operations in the Port of Virginia.

APM Terminals will continue with plans to implement technology features at the NIT gate, making revisions as needed based on further research of the existing project. Whether or not this happens in conjunction with the N4 TOS implementation will be determined at a future date and time to be determined after conclusion of the due diligence procedures associated with this bid.

The trucker appointment system is a critical element for planning container movements to and from the yard via the landside interface. Our goal is to deliver efficient turn times for the trucking community and having visibility on future container activities allows for better planning of terminal resources. We want the system to be effective for all parties and will establish a review process with the trucking community shortly after takeover. The goal of this

review process will be to ensure the appointment system functionality meets requirements for all parties.

The HRCP II service offering appears to be a successful venture in managing the steamship line chassis assets. The unique arrangement also appears to be of great value to the trucking community, reducing the need to process a chassis inspection for every transaction. APM Terminals plans to continue with a similar arrangement, ensuring that the Port of Virginia continues to have an industry leading chassis pool program.

Operating hours for gates at each facility will be evaluated based on demand. At present APM Terminals does not plan to make any immediate changes to the operating hours at either NIT or the APMTVA facility.

5 Capacity calculation based on ground slot figures provided by VPA. Formula is (TGS * TIME * OSH) / ((WADT * PF) * (1- (TS/2))) where TGS = Twenty Foot Ground Slots, TIME = Period, OSH = Operational Stacking Height, WADT = Weighted Average Dwell Time, PF = Peak Factor and TS = Transshipment Percentage.

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Future gate expansion plans for APMTVA are documented and will be implemented as part of the APMTVA Phase II build-out when volume triggers are realized. At NIT, the development plans for a second gate structure will be reviewed as the current design is linked to future developments of infrastructure planned by government entities.

APM Terminals regularly tracks the key measures around our gate performance, including transaction speed, truck turn time and processing time. Our goal as the operator is aligned with that of the gate customer – an efficient visit and predictable turn time.

Rail Operations

A marine terminal is but one link in an extensive and complex logistics chain. APM Terminals understands that working with our railway partners will enhance joint product offerings and make the Virginia Port a preferred gateway for inland markets.

With a reported 30% of throughput arriving or departing via intermodal trains, rail plays a significant role at the Port of Virginia. The processes established at both the APMTVA and NIT facilities deliver good results to support the current demand, but the anticipated growth will require expansion to increase the capacity of the operation. Physical expansion plans to double the track space at the APMTVA facility are ready to execute, and in conjunction with the CSX National Gateway project allowing double-stack trains, the capacity of the on-dock rail is set to increase significantly.

Cooperation with both the NS and CSX railroads was effective during the period in which APM Terminals operated APMTVA. With the customer in mind, the dual-operator approach has been a mandate of APM Terminals since the early days of the project to develop APMTVA. Providing options for rail carriers via on-dock rail yards vastly improves the product offering of the Port of Virginia.

To facilitate speed of service, physical layout changes may be needed at NIT and we will engage in conceptual discussions with the VPA when rail volume triggers so dictate.

Beyond the current expansion plans at the APMTVA facility, there is an option to implement high-speed RMG equipment to load and unload trains, replacing the RTG equipment in use today. Rail capacity could reach as high as one million moves in such an operation due to additional tracks and faster equipment. This long-term vision is part of the flexible design by APM Terminals and can be triggered when volume so dictates.

Empty Depots

The current operation for empty depot yards in Portsmouth (PCY) and Norfolk (NCY) allow convenient access for the trucking community and helps to unite the marine terminal facilities and the associated assets of the shipping lines.

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APM Terminals envisions continued operation of the two empty depot sites, managed closely to ensure customer inventory requirements are met at depots and marine terminals alike. Keeping the flow of empty transactions away from the marine terminals also allows for less traffic at the NIT and APMTVA facilities, allowing laden pick-up and drop-off transactions to be serviced more efficiently.

Volume figures for both empty depot facilities have not yet been made available for analysis in the overall operation of the Port making an accurate assessment of the container flows difficult. While APM Terminals envisions continued use of the facilities, both will need to be reviewed, in particular the NCY facility as the land is leased from Norfolk Southern. APM Terminals is prepared to discuss alternate arrangements with stakeholders to ensure service in the Port is not compromised.

Virginia Inland Port

Operations at the Virginia Inland Port (VIP) facility in Front Royal are envisioned to continue as-is. APM Terminals will review procedures and engage with stakeholders to determine if any operating changes should be implemented.

Newport News Marine Terminal

Operations for general cargo at Newport News Marine Terminal (NNMT) will be supported by APM Terminals to keep container traffic at the core facilities – NIT and APMTVA. As commodities and lease agreements within NNMT change, APM Terminals will adapt and review the business climate along with operational needs.

Portsmouth Marine Terminal

Given the existing lease agreements with multiple tenants at the Portsmouth Marine Terminal (PMT), APM Terminals has not made specific pre-considerations for the use of PMT in this bid. We are open to discussions with the VPA regarding our involvement with the future of the facility.

Labor Relations

APM Terminals and the International Longshoreman’s Association (ILA) have a long-standing relationship. As partners, we will work together in conjunction with the local port community associations to create a work environment that is safe and efficient, while providing desirable high-paying jobs for Virginians.

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Maintenance Plan

Equipment

Maintenance and its effect on the business performance is a key factor in the terminal industry, and is thus a key strategy in ensuring reliable and safe performance of equipment. Effective maintenance minimizes downtime on the operation, harm to the environment, the community and the workforce.

In line with the experience at modern world-class container terminals, the organization of repair and maintenance will be based on predictive and preventive measures rather than unplanned or breakdown maintenance. By applying the preventive maintenance system the following will be achieved:

• Increased safety of the operating personnel and the environment • Better service to vessels in view of less equipment failures • Reduction in total equipment cost due to extension of the working life of equipment and

reduction in regular maintenance cost

The equipment repair facilities allow for adherence to safe maintenance and environmental standards. All operating and repair manuals will be kept up-to-date and shall be accessible to all technical staff.

Maintenance will be conducted based on a planned schedule of preventative and predictive maintenance based on recommendations from the original equipment manufacturer. Applying a system of periodic maintenance, parts are replaced based upon experience with the working life of these parts or as a result of predictive monitoring. Predictive maintenance is the regular non-destructive inspection of machines to determine when parts or systems are beginning to degrade, risking interruption to operations. Identified issues are then planned into the next maintenance schedule.

Maintenance

Planned maintenance Unplanned maintenance

Unplanned corrective maintenance(Unplanned damage repairs)

Planned corrective maintenance

(Planned repairs, overhaul, condition based maintenance)

Preventive maintenance

Scheduled maintenance(Routine maintenance &

safety work)

Condition monitoring(Condition monitoring)

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Planned Maintenance

The initial planned maintenance standards are provided for by the equipment manufacturers, and it will be the responsibility of the maintenance and repair department to comply with or exceed the intent of these standards to ensure maximum safety, reliability and availability of equipment for terminal operation.

In order to achieve maximum productivity on the quayside, the management and staff of the marine facility must be able to count on having equipment available when required. Preventive and corrective maintenance schedules can be maintained if equipment is maintained to a reliability standard of 99%. Further, availability goals will be targeted for a minimum standard of 95%, as any reduction in these numbers will create unplanned idle time, reduced facility production and potential throughput capacity all leading to a dissatisfying service for customers of the terminal.

Regular inspections will be carried out by experienced technicians based on a checklist specifying those parts that require inspections after a fixed number of working hours, or number of cycles. Predictive maintenance will be complemented by periodic maintenance with regard to those components or parts, which have a reasonably predictable service life.

Unplanned Corrective Maintenance

During any operation, APM Terminals will have staff on-site to handle unplanned corrective maintenance that may occur, minimizing downtime during operations.

Facilities

APM Terminals Facility Maintenance follows the A.P. Moller Constant Care approach to “Take care of today, actively prepare for tomorrow”. Constant Care seeks to identify or prevent problems before they impact safety or operational efficiency. Where repairs are needed the focus is a permanent sustainable solution, so problems are not deferred or repeated. APM Terminals facility maintenance will provide a safe and clean terminal work environment that complies with federal, state and local regulations and permits, while facilitating productive terminal operations.

Daily Inspections

APM Terminals facility maintenance staff will inspect the terminal daily and work with all departments to ensure a safe and environmentally compliant workplace. They will follow-up on work done by yard sweepers and third party janitorial services to ensure our terminals stay safe and clean.

Maintaining Records

Copies of all terminal operating permits, as-built drawings, extended warranties, current contracts and operations manuals will be found in the Facility Maintenance office. These

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documents are maintained real-time to account for work-in-place, required maintenance and completed maintenance.

Preventative Maintenance

Marine terminals require extensive preventive maintenance to ensure safe and productive operations. Preventative maintenance is performed to keep all equipment and facilities safe and productive.

APM Terminals will implement a computerized preventive maintenance tracking system to keep track of required maintenance and to document performance. As-built records of any changes to permanent infrastructure will be maintained. Capital improvements or VPA provided major maintenance will be coordinated.

Pavement Maintenance

APM Terminals has developed an innovative Pavement Management System, QuayPave, which is based on the Paver System developed by the US Army Corps of Engineers and specifically tailored for marine terminal pavement. This system is available for use in managing multiple terminal pavement inventories, condition and maintenance to help identify when paving repair or replacement is needed.

APM Terminals Facility Maintenance Relationships

APM Terminals has had established relationships with local facility maintenance vendors for many years, from the operation of VPA’s Portsmouth Marine Terminal (PMT) to the construction and operation of the wholly owned APMTVA facility. We expect no disruption due to the transfer of facility maintenance responsibility to APM Terminals.

The facility engineering support for APM Terminals’ Americas Region is based in Portsmouth and will be available to provide support to the Virginia Facility Maintenance staff, access professional engineering support, or coordinate with the VPA engineering staff as needed for major maintenance issues or disaster recovery.

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III. MARKETING PLAN

APM Terminals’ objective for the Port of Virginia is to provide a world class port operation, while growing volume from the local hinterland and capturing a larger percentage of the intermodal rail business.

We will grow the local cargo base in two ways: 1) capturing the market for cargo that moves by truck from competing East Coast ports and 2) partnering with the VPA and the Commonwealth to ensure the development of robust logistics and light manufacturing infrastructure surrounding the Port to attract and retain Beneficial Cargo Owners (BCO’s) to Virginia.

We will attract intermodal rail cargo through efficiency and cost effectiveness and by working proactively with the railroads and our mutual customers to provide a strong value proposition. Competitive advantages can be established through the superior on-dock rail infrastructure, as well as leveraging APM Terminals’ operational expertise.

In addition, we believe there are untapped opportunities to develop the break bulk, roll-on/roll-off and project cargo commodities moving in and out of the Port, as Virginia presently lags behind its competitors along the East Coast.

Commercial Organization

Our commercial organization is well suited to achieve the Concession Objectives. APM Terminals is a worldwide terminal operator focused on building its customer base. The commercial organization includes Global Account Managers who regularly meet with our customers at procurement, managerial and executive levels. These managers operate in key shipping centers such as New York, Rotterdam, Panama City, Shanghai, Hong Kong, Singapore and Dubai. This ensures we reach the full range of customers who utilize the Port of Virginia.

Additionally, our international nature makes customer satisfaction imperative. Our shipping line customers are global companies as well. Therefore, we view every local customer relationship as vital and settle for nothing less than providing first-rate service.

Global Expertise, Local Roots

While this global organization will be an important tool, all marketing will be driven by our on-site Virginia team to achieve local objectives. This group will dedicate itself to excelling at local customer service as well as dealing with larger commercial endeavors such as contracting and establishing Terminal Service Agreements. APM Terminals plans to augment the existing commercial structure by adding our unique skill sets to it, rather than recreating it altogether. This will ensure a seamless transition and that the local relationships developed and valued today do not disappear tomorrow.

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Combining Resources with the VPA Marketing Team

APM Terminals has fostered a productive relationship with the VPA and the Commonwealth since entering Hampton Roads. This relationship will comprise the foundation of mutually beneficial marketing efforts going forward.

As concessionaire, we will coordinate with the VPA and map out our respective sales forces and establish a plan for integrating these two organizations to leverage mutual strengths and ensure maximum penetration in both shipping line and BCO markets and customers.

In integrating APM Terminals and the VPA commercial teams, we will create a sales pipeline broken down into short-term, medium-term, and long-term opportunities. We will then use our robust Customer Resource Management (CRM) system, Pipeline Management tool set, and Value Based Selling approach to manage targeted commercial leads, stakeholder management and contractual terms.

This APM Terminals-VPA partnership will become a competitive advantage over other ports. Typically terminal operators and port authorities have a more fragmented approach toward clients. Our unification of the Port on the ownership and operational end will produce this unique advantage for the Port of Virginia on the commercial end.

APM Terminals’ Proposed Rate and Governance Oversight by the VPA

APM Terminals confirms its commitment to fair and competitive business practices will be enforceable as legally binding contractual obligations. Accordingly, we propose that the Comprehensive Agreement contain provisions which address the following concepts.

• APM Terminals will honor all contracts in effect on April 4, 2012 between Virginia International Terminals (VIT) and Ocean Carriers and other customers and vendors doing business at the Commonwealth’s ports

• APM Terminals will establish a market-based tariff which provides competitive prices and services. The tariff will apply to all new contracts entered into after the effective date of the Comprehensive Agreement and, as to any current customer, after the expiration of that customer’s Existing Contract. The tariff will be transparent as to volume discounts and other incentives and will be applied to new contracts non-discriminatorily

• The VPA will oversee changes to the tariff and incentives to assure that price changes are based on Consumer Price Index, labor and other increases consistent with industry custom and practice

• APM Terminals will make new operational commitments such as preferential berthing and crane guarantees taking into consideration Existing Contract terms, relative volume and the efficiency of the Port. VPA will oversee these operational commitments to ensure that APM Terminals adheres to commercial standards of fairness

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• APM Terminals will not link customer contracts in Virginia to contracts at any other facility within our global portfolio

• APM Terminals will preserve the confidentiality of customers’ contracts and operational data and will not disclose such confidential information to any other customer, to any affiliate of APM Terminals, or to any other person or entity.

To ensure proper governance of these measures VPA will have the right to appoint an independent audit firm to verify APM Terminals’ adherence to these obligations.

Virginia’s Competitive Outlook

The Port of Virginia currently has a volume of 2.05 million TEU (2012 calendar year estimate), which makes it the third busiest port on the East Coast with a market share of around 12.2%.

There are several factors which will impact future volumes in Virginia and the East Coast in its entirety. The three most important market factors are:

• Impact of bigger ships: Panama Canal widening and increased utilization of the Suez Canal mean bigger ships entering the North American trade lanes

• Competing investment in port infrastructure: Ports along the East Coast are investing to be ready to compete for bigger services

• Fundamentals of hinterland transit: The competition amongst East Coast and West Coast railroads and the competitive connectivity of the ports along the East Coast.

Impact of Bigger Ships

Containership size has more than doubled between 2000 and 2010 and port infrastructure has actively modernized to accommodate this growth.

Moving forward, shipping alliances will continue to rely upon bigger vessels to reduce costs. About 80% of the 2012 order book constitutes vessels of at least 8,000 TEU in size and half of the total order book is 10,000+ TEU ships.

East Coast Market Share

35%

9%

6%

6%

5%4% 2%

12%19%

2% New York/New Jersey

Savannah

Hampton Roads

Charleston

Miami

Port Everglades

Jacksonville

Baltimore

Philadelphia

Wilmington (NC)

Global Containership Orderbook 2012

Source: Drewry Maritime Research

4%

7%

21%

50%

13%

6%

< 1,999 teu

2,000–3,999 teu

4,000–5,999 teu

6,000–7,999 teu

8,000–9,999 teu

10,000 teu +

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Within five years, most Asia-North Europe strings will be deploying 12,000+ TEU ships and there will be an ensuing cascading of bigger tonnage into the East-West and North-South routes.

One of the key components that will facilitate the larger ship calls is the widening of the Panama Canal. Additionally, the Suez Canal, which can already accommodate vessels of 9,600 TEU, plays an important role in Virginia. Over 40% of the services for the Port are Asian services.

Services to and from Latin America are also upgrading with the newest service Parana Bridge/XNS now deploying 5,700 to 6,732 TEU vessels.

Therefore, in order for the Port of Virginia to prosper, APM Terminals will ensure that not only will the Port be physically capable of handling these ships, but just as importantly, competitively capable – in terms of pricing, production and customer service.

Port Investments

To compete effectively with what Virginia already offers - water depth and no air draft restrictions - ports along the coast have announced capital improvement plans. As the table below indicates, Virginia’s competing ports have projects in the works to level the playing field.

Port Investment Project

New York / New Jersey $ 1,300 million Raise Bridge Baltimore $ 567 million Port Infrastructure Charleston $ 300 million Dredging Savannah $ 650 million Dredging

This means the advantage the Port of Virginia has enjoyed to date may be diminishing in a matter of years. Therefore, APM Terminals as concessionaire will institute differentiators when competing against its neighboring locations – namely the implementation of cutting edge technology towards key operating areas such as vessel, rail and gate production.

Hinterland Transit

Aside from the immediate cargo range of approximately 250 miles, the Port of Virginia’s targeted local market radius, there will be a significant competition to secure cargo moving via rail to/from the Midwest and Southern states. Today, this volume predominantly comes to those locations via the West Coast. The competitiveness of the Eastern (Norfolk Southern and CSX) versus the Western (Union Pacific and BNSF) railroads will play a big role in the competition for cargo in Virginia.

In 2011, according to the Association of American Roads, 11.9 million containers and trailers were moved by rail in the United States, of which 5.4 million were moved by Norfolk Southern and CSX together. The railroads handle 45% of the U.S. intermodal cargo market which covers an area containing 66% of the U.S. population. Consequently there is a potential for 2.5 million

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containers, which today are handled via the West Coast, to be handled via East Coast ports upon the expansion of the Panama Canal.

To help win this cargo APM Terminals will keep terminal handling costs down, efficiently hand off cargo to the railroads and tailor transportation solutions which fit customers’ needs.

Volume Forecast

To project the Port of Virginia’s volume growth over the coming decades we must first understand the overall United States container market as the primary component of trade development.

One of the best measures to project future growth is the long-term Gross Domestic Product (GDP) forecast. APM Terminals has used the forecasts of Global Insight and Business Monitor International. Both organizations forecast long-term GDP to develop at a rate of approximately 2.5%.

Historically the container industry has developed at various multiples against GDP; ranging from 4.5% more than a decade ago to 1.0% in recent years. Over time it is natural that this multiple converges to a level which closely mirrors GDP growth. This decreasing multiple is driven by two main factors. First is the maturation of the containerization trend. Second, from a macro-economic perspective, consumption growth (a large driver of the container trade) over time should more closely match total GDP growth.

Using this backdrop, as well as external sources of future volume projections, APM Terminals has established a base forecast as well as an optimistic projection for the Port of Virginia annual container volume, as illustrated below. A detailed Annual Volume Forecast is provided in Appendix II.

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

2035

2036

2037

2038

2039

2040

2041

2042

'000

TE

U

Base Case Optimistic Case

CAGR 4.0%(17% Mkt share)

CAGR 5.0%(22% Mkt share)

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This volume forecast delivers an increased market share from 12% to 17%. As context, if the Port of Virginia handled an additional 5% of the East Coast market today, it would represent more than 850,000 TEU of additional volume.

The table below provides an overview of the GDP, Port of Virginia growth and Virginia market share for the three concession periods. However, this projected volume growth and increased market share will not materialize without a strong operator in the Port. We must ensure that the Port of Virginia is the most competitive port, providing customers the best service and most cost effective product in the market.

CAGR 30 year

CAGR 40 year

CAGR 48 year

US GDP 2.5% 2.5% 2.5% Port of Virginia 4.0% 3.5% 3.3% VA market share* 17% 19% 20% *Port of Virginia share of East Coast Ports in the last year of the Concession

Going forward the biggest cost driver, and largest potential area for savings for shipping lines will be on the ship side. As ships get bigger, lines will be able to drive out significant costs from their end-to-end handling costs, but only if their ship is on the water. It will be vital to not only provide the navigable waters and port infrastructure to handle these ships, but to also be capable to get the ships in and out of the Port as expeditiously as possible.

Local Volumes

Local cargo makes up 70% of the volume through the Port of Virginia today. More than 50% of that loaded cargo has its destination within 250 miles from the Port, concentrated in the states of Virginia and North Carolina.

Port of Virginia Cargo Origin/Destination within US

Source: Mercator (*) Note: the Unknown section comprises majority of Virginia volumes, though not allocated due to PIERS data categorization

21%30623%17118%135Unknown*1,479749730Total

3%483%234%26MI3%464%302%16MO3%453%263%19SC

4%636%443%20MD7%9%

11%15%24%

%

101137158219356

Total(TEU ‘000)

4893

12653

135

Exports(TEU ‘000)

6%12%17%7%

18%%

7%53KY6%43OH4%32IL

23%166NC30%221VA

%Imports

(TEU ‘000)State

21%30623%17118%135Unknown*1,479749730Total

3%483%234%26MI3%464%302%16MO3%453%263%19SC

4%636%443%20MD7%9%

11%15%24%

%

101137158219356

Total(TEU ‘000)

4893

12653

135

Exports(TEU ‘000)

6%12%17%7%

18%%

7%53KY6%43OH4%32IL

23%166NC30%221VA

%Imports

(TEU ‘000)State

MN

IA

MO

AR

TX

TN

GASC

NC

VAMD

WVKY

IL IN OH

MI

MN

IA

MO

AR

TX

TN

GASC

NC

VAMD

WVKY

IL IN OH

MI

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The Port of Wilmington and the Port of Baltimore are the two closest ports to Virginia. Together they handle about 1 million TEU annually. Around 33% of Wilmington cargo stays in North Carolina; the other two-thirds travel further, including to Virginia. The Port of Baltimore has a large local cargo base which is similar in nature to Virginia’s cargo base. Additionally, any ship calling Baltimore must first pass by Hampton Roads. As concessionaire, winning the competition with these two locations will be one of APM Terminals’ first marketing goals.

Focusing on End Customers: Producers and Distributors

APM Terminals believes that focusing on BCOs is as important as targeting shipping lines. Building strong relationships with producers and distributors is the key to building a loyal customer base. We will work hand-in-hand with VPA to achieve this.

BCOs depend on high quality local infrastructure to invest in growing or establishing their production plants and distribution centers. By establishing and executing joint strategies, the Port and BCOs can decrease risk and grow together. APM Terminals will champion and support efforts similar to CenterPoint’s logistics park in Suffolk to achieve this.

The Virginia Inland Port plays an important role in this effort by offering customers more alternatives. APM Terminals manages hundreds of off-dock locations through the world. We have had success in these ventures by tying in the cargo between the port and inland location and creating value added services to customers with a focus toward improving their end-to-end logistics costs.

Intermodal Rail Volumes

Intermodal rail cargo is predominantly driven by trade in Illinois, Ohio and Kentucky. Today, rail represents 30% of the Port of Virginia’s volume, or approximately 600,000 TEU.

This diverse cargo base is similar to other competing ports along the East Coast. Therefore, there is ample opportunity to gain market share increases, but also sufficient risk that other ports will be successful in targeting business that currently moves through Virginia.

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Virginia can compete for a wide network of inland locations however; Virginia is not the closest port location to any of the main intermodal rail destinations. The Port of Virginia does have a wider network potential compared to competing North Atlantic and South Atlantic ports, due to its central locality. Markets such as the Greater Atlanta and Memphis Regions will be specifically targeted for future growth opportunities.

Bigger ships will yield more moves per vessel call. By providing a cost effective service to a breadth of locations, we will attract international shipping lines through the value of dispersing more cargo to more locations in one stop. To advance this, APM Terminals will work with the railroads and VPA to create effective marketing plans towards customers.

APM Terminals has vast experience in handling and growing rail volumes, ensuring that containers pass though our hands in the safest, most cost effective manner possible. Our terminal in Los Angeles provides a good example of our ability to synergize with local railroads. At Pier 400, we operate a 40 acre on-dock complex, the country’s largest on-dock rail facility. In coordination with multiple Class I and Short Line Railroads, APM Terminals handles more than 730,000 TEU in rail volume annually.

Similarly, we developed APMTVA in close collaboration with rail stakeholders to create a high value product. APMTVA is the first facility in Hampton Roads with true dual access, which led to an increase in rail volume since the facility opened in 2007 from 440,000 TEU to approximately 600,000 in 2012, a growth of over 35%. This has provided an added option for the port's carrier customer base and thus contributed to a more competitive situation that will benefit the Port of Virginia in the long term.

Break Bulk and General Cargo

The Port of Virginia’s core revenue driver is containerized transport. However, the break bulk, RO/RO and general cargo market represents a strong opportunity. Typically, this labor intensive cargo creates more employment opportunities than containers. The development of alternative cargo will diversify the Port’s business thereby creating a more resilient maritime industry.

APM Terminals operates multipurpose terminals in various port locations throughout our global portfolio. Thus, APM Terminals can add significant value to the Port of Virginia in augmenting its general cargo business model.

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The VPA today has many important partners who handle break bulk, RO/RO and general cargo. APM Terminals will work with these organizations and the VPA to further market the Port and expand these volume segments, reversing the recent trend of decreasing volume.

We believe that in order for the Port of Virginia to be successful there should be a more healthy revenue split between containers and other lines of business. Compared against competitors on the East Coast, the Port of Virginia can grow this area of business by 3 – 5 times before equaling the same level as next lowest port in terms of percentage of business, as further illustrated in the graphic above.

The size of break bulk and auto operation activities has been decreasing over the past years. In 2011, these segments made up only 2.2% of the total tonnage handled by VPA – a reduction from only 3.1% of the total tonnage in 2005.

With its on-dock covered storage buildings, together with 140 acres of yard area and on-dock rail service, NNMT is well-suited to handle break bulk shipments, project cargoes, and even certain smaller-volume dry bulk commodities. There are several commodities moving through neighboring ports via the break-bulk mode that should be captured for NNMT.

For example, roughly 130,000 tons per year of break bulk rubber are imported through the Port of Morehead City and are then moved by rail to tire manufacturing plants dispersed across multiple states. Similarly, the Port of Baltimore imports nearly 600,000 tons annually of paper and forest products and the Port of Wilmington imports about 50,000 tons per year of steel products. All of these cargo flows should be targeted for NNMT.

Furthermore, the Port of Baltimore handled over 1.4 million tons of vehicles and over 400,000 tons of machinery during 2011. The fact that the Port’s facilities of PMT and NNMT can provide dual-carrier rail access and over 3,500 feet of berth should enable us to compete for portions of these markets.

Gross Revenue Share Forecast

APM Terminals proposed a gross revenue share in the Unsolicited Proposal in order to incentivize the VPA to remain a critical component of the marketing efforts of the Port. APM Terminals sees this as a vital responsibility for the VPA to ensure the Port achieves its full potential.

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Additionally, we recognize the value of transparent and predictable cash flows for the VPA. APM Terminals wants to pay from the first dollar earned – not from high growth number which often results in a lack of clarity and certainty.

The proposed revenue share is 4%, less any direct pas through charges. The Port today generates approximately $300 million in revenue, equating to roughly $12 million in future contributions from APM Terminals to VPA.

A detailed breakdown of the gross revenue share is provided in Appendix I.

IV. DETAILED CAPITAL INVESTMENT PLAN

Port of Virginia Development Plan

Bringing private capital to the Port of Virginia is one of the benefits of APM Terminals’ concession proposal. With our growth aspirations for the Port there must also be a robust investment plan associated with this progression.

Our vision for development is to implement the second phase of APMTVA, thereby adding 1.6 million TEU of capacity to the Port. At NIT we will focus our efforts on modernizing the terminal. This will include the eventual transformation from Straddle Carrier operations to RTG’s. Ultimately we will be able to expand that facility to handle a minimum of 3.3 million TEU.

Accompanying development, the facilities will need to be maintained at high standards to ensure a safe working environment and operational effectiveness. APM Terminals will undertake this effort and apply our best practices from the global portfolio.

Depending on the agreed term of the concession, APM Terminals is prepared to undertake varying levels of capital responsibility. Overall, we believe we are well positioned to develop APMTVA Phase II and the full scope of superstructure investments, such as operating equipment and new information technology.

VPA will be responsible to ensure the proper infrastructure is in place, such as berths, dredging or other works that fall under the auspices of the VPA. This relationship structure is common among concession agreements in the landlord/tenant port model.

Because we have not been provided the detailed calculations or master planning for the Port’s infrastructure investments we have used the figures found in the latest VPA Capital Investment Plan (CIP) as indications of the required infrastructure capital expenditures for the VPA.

No investment plan has been established regarding the Craney Island Marine Terminal development. The development of this facility is an excellent opportunity for the Commonwealth

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and VPA however, we believe one of the value propositions offered is to postpone the major capital investments for that development for decades to come.

Capital Maintenance Improvements

Superstructures

All container handling equipment will be maintained by APM Terminals as part of our 40 and 48-year proposals. The 30-year proposal assumes that the VPA will take on the responsibility for all STS, RMG, and RTG cranes, while APM Terminals remains responsible for all other superstructure. As outlined in the Operations and Maintenance Plan, the approach to maintenance on superstructure assets will encompass Planned and Unplanned activities. All efforts will be made to perform preventative maintenance as per manufacturer recommendations; however through normal use it is likely that some equipment will require unplanned maintenance, corrective or otherwise.

As running hours and technical lifetime for equipment reaches maximum levels for safe operation, replacement equipment will come online in the operations. APM Terminals has wide-ranging relationships and master framework agreements with many industry leading manufacturers of container handling equipment. These frame agreements have APM Terminals minimum equipment specifications to ensure safety and performance standards within the organization are adhered to for all future equipment purchases.

As operations practices, technology and other equipment continue to mature in size, proportion and impact, APM Terminals will be prepared. Continuous review of equipment standards and operational performance takes place internally with our Crane Engineering Services division.

Berth Infrastructure

In a typical landlord/tenant relationship for marine terminals the berth infrastructure remains the responsibility of the landlord, in this case the Virginia Port Authority. This is the assumption for all three terms that APM Terminals is proposing.

We have not projected any needed berth expansion outside of the development of APMTVA Phase II our business plan.

Details on this aspect of the relationship will be finalized in the concession agreement and APM Terminals will of course honor responsibilities as agreed upon.

Technology Improvements

The APM Terminals facility in Portsmouth is one of the most technologically advanced terminals in the world. APM Terminals will leverage this advantage to execute safe, productive and cost efficient operations in the Port of Virginia.

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Technology is continuing to advance at a phenomenal pace and APM Terminals has a Design & Innovation team that is monitoring these developments in the market. We are working with companies to pilot and develop new technologies for use in container terminal and port operations.

APM Terminals has historically had strong influence on the evolution of Terminal Operation Systems (TOS) in the port industry. The deployed TOS at APMTVA is evidence of this impact that continues now with our development of advanced terminal facilities such as Maasvlakte II in The Netherlands. In the Americas Region, we have established a Next Generation Terminal Technology (NGTT) workgroup, tasked with identifying leading edge technologies for use in our facilities. APM Terminals views technology as an enabler for better performance and also as a means of improving the customer experience through greater transparency and increased reliability.

All facets of technology will be monitored for developments in specific segments of the market and APM Terminals will implement solutions that improve performance, service and deliver returns on the business.

Paving

As outlined in the Operations and Maintenance Plan, APM Terminals has developed a pavement management system based on the Paver System used by the Army Corps of Engineers. This program, QuayPave, is tailored specifically for the marine terminal environment and can be used to manage the regular maintenance activities associated with paving.

APM Terminals will work closely with the VPA and as per the Concession Agreement to ensure the paving in facilities is not neglected. Ongoing maintenance and repair of the yards and pavements will be APM Terminals’ responsibility, while VPA will remain responsible for major yard infrastructure projects under all three proposed concession terms.

Capital Expansion

APM Terminals Phase II

The APMTVA Phase II expansion will be the first major expansion of capacity in the Port of Virginia under the Concession Period. To be triggered in segments when volume thresholds are realized, the total capacity of the APM Terminals facility is estimated to be 3.2 million TEU.

The expansion is envisioned to occur in segments, starting with the rail yard to increase capacity for intermodal cargo. Rail throughput capacity at APMTVA will double with the planned physical expansion, and in conjunction with the full double-stack services from both NS and CSX, the capacity will further increase to an estimated 540,000 moves per annum. A potential change from the current RTGs to RMGs will provide four additional tracks and faster lift-on/off production, bringing the estimated capacity to more than one million moves per annum.

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Increasing the number of RMG stacks in the yard will happen in phases based on volume demand. APM Terminals is prepared to undergo development together or in a sub-phased approach of smaller expansions. This paced development will ensure that capacity and demand are aligned, allowing assets to be well-utilized before investing more in infrastructure and superstructure assets. As described in the Operations and Maintenance Plan, the design for Phase II is ready to deploy, however minor changes based on lessons learned and business demands may be implemented. One such example is to have a higher ratio of reefer racks to RMG stacks, where Phase I of the terminal has one reefer rack for every three RMG stacks.

The berth expansion at APM Terminals will add 650 feet to the existing 3,250 foot structure. The additional linear footage will support a third large vessel alongside if the berthing schedule and customer demand requirements of the future so dictate. Plans call for an additional four ship-to-shore cranes to be added, ensuring that enough cranes are available for any combination of vessels that may be alongside.

The existing truck gate will be expanded by a total of eight lanes, four each for inbound and outbound traffic. All features of the current gate facility will be included in the expansion, including scales at the inbound lanes.

NIT North and South

The current design of NIT includes relatively new features such as the Central Rail Yard. The current layout supporting the Straddle Carrier (SC) operation appears sufficient given physical constraints associated with buildings, finger piers and third party property separating the facility into North and South terminals.

APM Terminals plans to increase the operational stacking height by deploying 1-over-3 SCs in the facility. This increase provides an estimated throughput capacity of 2.29 million TEU for the combined NIT facilities. The SC fleet would be gradual in the build-up to 1-over-3 machines, likely to occur in small batches based on replacement of aged 1-over-2 machines. Based on volume forecasts we anticipate the entire fleet to be 1-over-3 by 2032.

It is anticipated that the current pavement is able to support stacking of three-high laden containers, however a feasibility review will be necessary and should incorporate elements such as wind and weather to ensure safety is not compromised.

Should due diligence and feasibility studies prove that the cost effective move to 1-over-3 SCs is not safe for operations on that particular site, APM Terminals will review other expansion and/or densification options with the Virginia Port Authority. This would include discussions about developing NIT to support RTGs, RMGs.

APM Terminals will evaluate significant changes to the NIT to include, but not be limited to the demolition of finger Piers: Pier 1 and Pier 2 and warehouses 6-8.

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These structures are aged and of limited use, and in some cases are already roped off to prevent use due to collapsed roofs and other structural elements.

The demolition of the finger piers would facilitate the flow and focus on container operations. Removing the warehouses can create additional container stacking and storage for rail containers (potentially a new Rail Interchange Zone), a central empty yard or additional area for laden containers. The estimated 19 acres of land could potentially create 1,992 twenty-foot ground slots (TGS) in the straddle carrier yard configuration. This represents an estimated capacity of 325,000 TEU of additional throughput6.

Virginia Inland Port

This inland rail facility operated by SC equipment is an important element of the logistics chain for cargo transiting the Port of Virginia. From available information it is not clear what, if any, expansion plans exist for this facility but APM Terminals sees opportunity given the current land boundaries. Additional rail tracks and stacking/storage area can be developed with relative ease, increasing the capacity of VIP as needed to support container movement or additional handling of general cargo such as hardwood logs.

Newport News Marine Terminal

APM Terminals intends to use NNMT as is currently scoped, supporting the majority, if not all, general cargo in the Port of Virginia. Capital investments at NNMT will be considered case-by-case as the mix of leased land and commodities require ad hoc review of layouts, warehouse operations, storage structures and other supporting equipment.

Empty Depots: NCY and PCY

Norfolk Container Yard (NCY) and Portsmouth Container Yard (PCY) are empty depots located outside the boundaries of the marine terminals in the Hampton Roads area and provide an excellent relief valve for operations and customers alike.

The NCY facility is known to be on land owned by a third party and thus the future operations status will need to be reviewed. Expansion opportunities are also unclear and terms of the lease have not been disclosed.

Expansion opportunities for PCY, located on approximately 44-acres of the Portsmouth Marine Terminal, will need to be part of future discussions with the Virginia Port Authority, but APM Terminals intends to keep this site and service as part of the active operations going forward.

6 Capacity estimate based on use for laden containers in standard straddle carrier layout.

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Obligations for Capital Expenditures

APM Terminals has created a forecast of annual capital expenditures for each terminal which is presented in Part 6 of the Financial Information Form. These figures should not be viewed as obligations, but as a best estimate of anticipated capital needs.

Each instance of asset replacement will be individually reviewed for need based on the condition of the asset to be replaced. Each expansion will be initiated as demanded by utilization levels in the respective facility.

Based on our current forecast for volume growth, utilization levels, evolution of best practices and market conditions, we estimate that significant capital expenditure will need to take place over the course of a 30, 40, or 48-year concession.

Capital Investment Forecast Nominal $ Millions

30-Year Proposal

40-Year Proposal

48-Year Proposal

APMT Investment 796 2,370 3,380

VPA Investment 920 163 45

Total Value 1,716 2,533 3,425

APM Terminals proposes that this investment be shared as follows:

• APM Terminals will be responsible for all superstructure investment in the 40 and 48-year proposals, but VPA will take on the investment in STS, RMG and RTG cranes as part of a 30-year concession

• VPA will be responsible for all infrastructure investment under the 30 and 40-year proposals, but APM Terminals is responsible for the investment in APMTVA Phase II infrastructure in the 48-year concession.

In arriving at these figures, we made some important assumptions which should be considered when reviewing the financial information form.

The infrastructure investment has been considered per the VPA Capital Investment Plan (CIP) Project List, excluding any items relating to the Craney Island development. The amount listed for “Small Capital & Maintenance Dredging” has also been excluded from these forecasts.

Superstructure investments are included per APM Terminals’ volume forecast and technical lifetime standards. APM Terminals’ independent estimates of superstructure investments resulted in amounts greater than the totals listed in the VPA CIP. Given this difference in value it should be noted that APM Terminals sees a risk that the VPA infrastructure investment figures in the above table may be insufficient due to a possible similar understatement of capital needs.

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PART 2 b – FINANCIAL PLAN

I. FINANCIAL PLAN

Funding the Transaction and Future Capital Investments

The proposed PPTA transaction is being submitted by APM Terminals Virginia, Inc., a wholly owned subsidiary of APM Terminals North America, Inc. acting as guarantor. The proposed investments in Virginia build upon on a proven track record of APM Terminals investments in terminal infrastructure in the United States of America and more specifically in Hampton Roads.

Both APM Terminals and its parent have a strong credit profile, ample financing capacity, strong cash flow generation and a history of successful capital investment. APMM A/S had as per 30 September, 2012 a liquidity reserve of $13.5 billion.

APM Terminals anticipates that it will fund its proposed upfront concession payment using its existing financial reserves as well as financing to be made available from its parent. Through the term of the concession, APM Terminals anticipates that it will fund its fixed monthly payments, revenue sharing payments, terminal maintenance expenditures and working capital needs using cash flow generated from operations, existing financial reserves, and readily available credit lines.

As referenced in the Appendix to the Unsolicited Proposal, three of APM Terminals’ North American banking partners have issued letters of reference, citing significant lines of credit.

Cash Flow Generation and a Track Record of Successful Capital Investment

APM Terminals produced revenue of $4.7 billion, EBITDA of $1.0 billion and cash flow from operations of $912 million from its global terminal operations in 2011. APM Terminals has an invested capital base of $5.2 billion.

As further evidence of APM Terminals’ ability to finance substantial capital investments, the development of APMTVA was financed 100% internally.

Financing Roles

Commonwealth and Virginia Port Authority

The first consideration in the VPA’s financing role and responsibility is the need to repay current outstanding bonds as a result of a concession being granted. APM Terminals understands this requirement as well as how it relates to the two minimum payment curve scenarios outlined in Appendix 1 of the Instructions to Proposers.

The compensation offered in this bid is compliant with the Taxable Refinance scenario. However, APM Terminals is prepared to work with the VPA to identify if an alternative scenario

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48

exists that would provide the most effective solution for minimizing financing costs while maximizing the ability to fund new investments for Port development.

The financing role of the Commonwealth and VPA going forward is for the funding of capital maintenance and expansion of the infrastructure in the Port. The estimated required investment for those items is outlined in Part 5 of the Financial Information Form included in this Proposal.

APM Terminals

As outlined in the Detailed Capital Investment Plan, APM Terminals will be responsible for all capital maintenance and investment in superstructure equipment required for the operation of the Port. An estimation of these expenditures is outlined in Part 6 of the Financial Information Form.

APM Terminals assumes that we will be solely responsible for the financing of these investments and no support from the Commonwealth, VPA or access to federal funding is anticipated.

Minimum Financial Requirement

The proposed financial consideration outlined in the Financial Information Form for a 30, 40 or 48-year concession, inclusive of the concession fee, fixed concession payments and gross revenue share payments, satisfy the requirements of the Taxable Refinance Minimum Payments Curve as illustrated in Appendix 1 of the Instructions to Proposers.

Detailed Proposal

Appendix I

CONFIDENTIAL

December 3, 2012

Detailed Proposal

Appendix II

CONFIDENTIAL

CERTIFICATION REGARDING DEBARMENT

The undersigned Proposer certifies on behalf of itself and all members of the Proposer Team that, to the best of its knowledge and belief, each such entity and its principals:

(a) are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from covered transactions pursuant to an established debarment procedure by any public body, agency of another state or agency of the federal government, including debarment due to contravention of legal or safety regulations;

(b) have not within a three (3)-year period preceding this proposal been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (federal, state or local) transaction or contract under a public transaction, violation of federal or state antitrust statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property;

(c) are not presently indicted for or otherwise criminally or civilly charged by a governmental entity (federal, state or local) with commission of any of the offenses enumerated in paragraph (b) of this certification;

(d) have not within a three (3)-year period preceding this application/proposal had one (1) or more public transactions (federal, state or local) terminated for cause or default; and

(e) have not within the past ten (10) years been convicted of a crime related to governmental or nongovernmental contracting, including, but not limited to, a violation of (i) Article 6 (Section 2.2-4367 et seq.) of Chapter 43 (Virginia Public Procurement Act), (ii) the Virginia Governmental Frauds Act (Section 18.2-498.1 et seq.), (iii) Chapter 4.2 (Section 59.1-68.6 et seq.) of Title 59.1, or (iv) any substantially similar law of the United States or another state.

Where the Proposer is unable to certify to any of the statements in this certification, it will attach a certification to its Detailed Proposal stating that it is unable to provide the certification and explaining the reasons for such inability. For any explanation noted, indicate below to whom it applies, initiating agency, and dates of action. Providing false information may result in federal criminal prosecution or administration sanctions. The Proposer will provide immediate written notice to the Virginia Secretary of Transportation and the Virginia Port Authority if at any time the Proposer learns that its certification was erroneous when submitted or has become erroneous by reason of change of circumstances. Capitalized terms used but not defined herein shall have their respective meanings set forth in Version 2 of those certain "Instructions to ProposersRelating to a Concession of the Port of Virginia," dated as of November 19, 2012.

[Remainder of page intentionally left blank]

The undersigned makes the foregoing statements to be filed with the Detailed Proposal submitted on behalf of the Proposer and all members of the Proposer Team.

Signature:

Name: John E. Crowley

Title: Senior Vice President – Law & Regulatory Affairs

Proposer: APM Terminals Virginia, Inc.

Date: December 3, 2012

Signature on fileSignature on file

COMPLIANCE WITH LAW CERTIFICATION

The undersigned Proposer certifies on behalf of itself and all members of the Proposer Team that, to the best of its knowledge and belief, that none of the Proposer, any members of the Proposer Team nor any of their respective officers, directors, employees, shareholders, partners or agents:

(a) is a Restricted Party or has received notice of or is aware of any proceeding, claim, action, suit, proceeding or investigation (Proceeding) against it concerning Sanctions;

(b) has within a three (3)-year period preceding this proposal been convicted of a criminal offense;

(c) is presently under indictment or otherwise charged by criminal information or warrant by a governmental entity (federal, state or local); or

(d) is otherwise in violation of applicable law or subject to any Proceeding where such violation or Proceeding would reasonably be likely to have a material adverse effect on the Proposer's ability to participate in a concession of the Port.

Restricted Party means a person that is (a) listed on, or owned or controlled by a person listed on, or acting on behalf of a person listed on, any Sanctions List, (b) located in, incorporated under the laws of, or owned or controlled by, or acting on behalf of, a person located in or organized under the laws of a country or territory that is the target of country-wide or territory-wide Sanctions or (c) otherwise a target of Sanctions ("target of Sanctions" signifying a person with whom a United States (US) person or other national of a Sanctions Authority would be prohibited or restricted by law from engaging in trade, business or other activities).

Sanctions means the economic sanctions laws, regulations, embargoes or restrictive measures administered, enacted or enforced by (a) the United States government, (b) the United Nations, (c) the European Union or its Member States, including, without limitation, the United Kingdom, or (d) the respective governmental institutions and agencies of any of the foregoing, including, without limitation, the Office of Foreign Assets Control of the US Department of Treasury (OFAC), the United States Department of State (the State Department), and Her Majesty's Treasury (HMT) (together, the Sanctions Authorities).

Sanctions List means (a) any of the following lists maintained by OFAC, the State Department, the United States Department of the Treasury, the Bureau of Industry and Security of the United States Department of Commerce or HMT: the "Specially Designated Nationals and Blocked Persons" list, the Denied Persons List, the Unverified List, the Entity List, the Debarred List, the Consolidated List of Financial Sanctions Targets, and the Investment Ban List, (b) any similar list maintained by, or public announcement of Sanctions designation made by, any of the Sanctions Authorities, and (c) any other list of persons with whom the Commonwealth of Virginia may not conduct business under applicable law.

Where the Proposer is unable to certify to any of the statements in this certification, it will attach a certification to its Detailed Proposal stating that it is unable to provide the certification and explaining the with particularity reasons for such inability. In addition, the Proposer shall attach supporting documentation applicable to the inability to make the certification. For any

explanation noted, indicate below to whom it applies, initiating agency, and dates of action.Providing false information may result in federal criminal prosecution or administration sanctions. The Proposer will provide immediate written notice to the Virginia Secretary of Transportation and the Virginia Port Authority if at any time the Proposer learns that its certification was erroneous when submitted or has become erroneous by reason of change circumstances. Capitalized terms used but not defined herein shall have their respective meanings set forth in Version 2 of those certain "Instructions to Proposers Relating to a Concession of the Port of Virginia," dated as of November 19, 2012.

The undersigned makes the foregoing statements to be filed with the Detailed Proposal submitted on behalf of the Proposer and all members of the Proposer Team.

Signature:

Name: John E. Crowley

Title: Senior Vice President – Law & Regulatory Affairs

Proposer: APM Terminals Virginia, Inc.

Date: December 3, 2012

Signatures on fileSignature on file

!

(A) PROPOSER OWNERSHIP CERTIFICATION

Information concerning the Applicant

Name of the Applicant: APM Terminals Virginia, Inc.

Business Address of the Applicant: 1000 APM Terminals Boulevard

Portsmouth, VA 23703-2631

Telephone: 757-686-6501 Fax: 757-686-6508

Email: Eric.Sisco@apmterminals.com

Name of Contact Person: Eric Sisco

Legal Form of the Applicant: Corporation

State of incorporation of organization of the Applicant:

Incorporated in the Commonwealth of Virginia on September 6, 2001

Names and titles of all officers and directors of the Applicant:

Officers:

Eric Sisco – President

John Loepprich – Senior V.P./Treasurer/Corporate Secretary

Jack Craig – Senior Vice President/COO

Board of Directors:

Eric Sisco (Chairman)

Jack Craig

John Loepprich

Name, business address and percentage interest of each Person with a direct or indirect interest

of ten percent or greater in the capital stock, units, partnership or membership interests and other

equity interests or securities of the Operator (including options, warrants and other rights to

acquire any such equity interests):

Universal Maritime Service Corp (UMS) owns 100% of the outstanding capital stock of

APM Terminals Virginia, Inc.

UMS in turn is 100% owned by APM Terminals North America, Inc.

Business address for both entities: 9300 Arrowpoint Boulevard

Charlotte, NC 28273

!

(B) OPERATOR OWNERSHIP CERTIFICATION

Information concerning the Operator

Will the Operator be the Applicant?: Yes

If no, will the Operator be a wholly-owned subsidiary of the Applicant (a “Subsidiary”)?: N/A

If neither the Applicant nor a Subsidiary will be the Operator, please answer the

following items regarding the Operator:

Name of the Operator: N/A

Business Address of the Operator: N/A

Telephone: N/A Fax: N/A

Email: N/A

Name of Contact Person: N/A

Legal Form of the Operator: N/A

State of incorporation or organization of the Operator: N/A

If not incorporated in Virginia, is the Operator authorized to do business in Virginia?:

N/A

List the names and titles of all officers and directors of the Operator: N/A

List the name, business address and percentage interest of each Person with a direct or

indirect interest of ten percent or greater in the capital stock, units, partnership or

membership interests and other equity interests or securities of the Operator (including

options, warrants and other rights to acquire any such equity interests): N/A

Provide the following on a separate sheet: N/A

(a) a brief description of the capitalization of the Operator.

(b) a brief description of the experience of the Operator in operating comparable Port

facilities.

(c) a brief description of the material terms of the proposed agreement between the

Concessionaire and the Operator that would reasonably be expected to impact the

ability of the Concessionaire to comply with the terms of any Comprehensive

Agreement.

Detailed Proposal

Appendix VI

CONFIDENTIAL