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KeyBanc Capital Markets Industrial, Automotive, and Transportation Conference May 2012

KeyBanc Capital Markets Industrial, Automotive, and Transportation Conference May 2012.

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KeyBanc Capital Markets Industrial, Automotive, and Transportation Conference May 2012

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  1. KeyBanc Capital Markets Industrial, Automotive, and Transportation Conference May 2012

  2. The following information contains, or may be deemed to contain, “forward-looking statements” (as defined in the U.S. Private Securities Litigation Reform Act of 1995). Forward-looking statements can be identified by, among other things, the use of forward-looking language, such as “believes,” “expects,” “estimates,” “may,” “will,” “should,” “could,” “seeks,” “plans,” “intends,” “anticipates” or “scheduled to” or the negatives of those terms, or other variations of those terms or comparable language, or by discussions of strategy, goals, potential opportunities, targets or other intentions. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The future results of the Company may vary from the results expressed in, or implied by, the following forward-looking statements, possibly to a material degree. For a discussion of some of the important factors that could cause the Company’s results to differ from those expressed in, or implied by, the following forward-looking statements, please refer to the Company’s Annual Report on Form 10‑K for the year ended December 31, 2011 and its Quarterly Reports on Form 10-Q, as well as other reports filed with the Securities and Exchange Commission that are incorporated by reference into the prospectus supplement related to this offering. The Company undertakes no obligation to update or revise any forward-looking statements. This presentation contains certain supplemental measures of performance that are not required by, or presented in accordance with, U.S. GAAP. Such measures should not be considered as alternatives to GAAP measures and reconciliations of such measures to the nearest GAAP measure can be found in the Appendix hereto. The Company has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement, the preliminary prospectus supplement relating to this offering and other documents the issuer has filed with the SEC and that are incorporated by reference therein for more complete information about the Company and this offering. You may get these documents for free by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, the Company, any underwriter or any dealer participating in the offering will arrange to send you the prospectus and the preliminary prospectus supplement if you request it by calling Goldman, Sachs & Co. at 1-866-471-2526. Forward Looking Statements and Disclaimer 1

  3. Business Overview

  4. Leading Management Team Diverse Group of Blue-Chip Customers in Attractive Markets Asset-Light and High ROIC Business Model SignificantOrganic and Acquisition-Driven Growth Opportunities Investment Highlights Strong Profitability and Free Cash Flow Generation Logistics and Intermodal Leader for the Chemical and Energy Markets

  5. Quality Distribution at a Glance Logistics Energy Intermodal High growth rate transportation for oil and gas frac shale market Leading North American bulk chemical distribution network Leading North American intermodal container and depot services network LTM Operating Revenues(1) = $638 million LTM Segment Op. Income(2) = $59 million • LTM 3/31/2012 Operating Revenues excludes fuel surcharge of $122 million. • Segment Operating Income excludes Depreciation and Amortization and other income/expense. 4 4

  6. BULKEQ2011\Investor Presentation\ExcelInserts v01.xlsx (End-Market Chart 1) \\IBNJS002VF\BULKEQ2011\Graphics\Visio\Largest Bulk Carrier in NA.vsd Bulk Chemical Logistics Leader Overview Largest Bulk Carrier Network in North America • Asset light business model • Largest nationwide network • Market forces advantageous for largest carriers • Locations within close proximity of customers • Local operational excellence and account management • Strong presence in U.S., Canada, and Mexico • No major exposure to any single end-market Legend QCI Driver Safety School Mexican Partner Chemical & Food Grade Transportation Market (1) Estimated End-Market Breakdown (2) • Bulk Transporter’s Tank Truck Carrier 2010 Annual Gross Revenue Report and Management estimates. • Based on Management estimates.

  7. Bulk Chemical Intermodal Leader (Boasso) Overview Key Locations • Largest North American ISO tank container services provider • Core asset-light infrastructure business • Nine strategically located terminals • Provides: • Transportation • Tank cleaning, heating and testing • Maintenance and storage • Maintains recurring, high ROIC • Customers include leading tank operators and shippers • Recently acquired Greensville Transport Company Greensville (Norfolk) Estimated North American Intermodal Container Market U.S. Chemical Imports and Exports • Sum of U.S. Chemical Imports and Exports 2011 Source: Bureau of the Census, U.S. International Trade in Goods & Services Source: Management estimates

  8. Logistics Leader in Emerging Energy Market Overview U.S. Natural Gas Production by Type • Entered emerging, fast-growing market in late 2010 • LTM 3/31/2012 Energy revenues of $41 million • Operating multi-year logistics contract – major E&P co. • Serving multiple customers in the Marcellus Shale • Primarily hauling fresh and disposal water • Added oil hauling affiliate in Eagle Ford Shale in Q4 2011 • Acquired Trojan Vac in Eagle Ford Shale in Q2 2012 • Recently signed definitive agreement to purchase Wylie Bice Trucking and RM Resources in Bakken Shale • Compelling market economics • Estimated 3x equipment utilization vs. core • Generates higher operating margins • Results in high ROIC • Highly fragmented market Key North American Shale Plays Source: EIA 2012 Outlook, DOE, Independent Oil and Gas Association of Pennsylvania

  9. Blue Chip Customer Relationships in Attractive Markets Core carrier to top chemical and E&P companies across diverse markets 8

  10. Multiple Opportunities for Growth Opportunistic Growth • New affiliate additions • Private fleet conversions Energy Market • Diversifies revenue stream • Opportunity for high-returns • Rapidly growing marketplace • Increase EPS • and ROIC • Growth strategies help drive earnings expansion • Strong free cash flow helps enable investment and debt reduction Organic Growth - Chemicals • Increase volume to current customers • Favorable pricing environment • Low natural gas prices driving growth • EOBR implementation nearly complete Intermodal Growth (Boasso) • Capitalize on international trade • Fast growing shipping mode Bolt-on/Strategic Acquisitions • Numerous potential targets • Opportunistic investments • Chemical, energy, and intermodal market focus 9

  11. Energy Market Growth Opportunity Significant Shale Gas Deposits in the U.S. Marcellus Potential Growth (Bcfe/d) Eagle Ford Potential Growth Bakken Potential Growth Frac Shale Market Represents an Estimated $2+ Billion Market Opportunity(1) Source: United States Energy Information Administration; United States EPA GWPC; ALL Consulting; EIA, Texas Railroad Commission, Arkansas Oil & Gas Commission. (1) Based on industry forecasts and management estimates.

  12. Indexed Price 300 250 200 150 100 50 0 Jan - 07 Jan - 08 Jan - 09 Jan - 10 Jan - 11 Jan - 12 Crude Oil Ethanol Natural Gas Natural Gas Provides North American Energy Cost Advantage Investment Plans Stemming from Shale Gas Favorable North American Energy Cost Advantage • Dow plans to build new ethylene unit and propylene unit • Formosa plans $1.5 billion ethylene plant • Chevron Phillips announced new PE plants and ethane cracker • Bayer considering ethane cracker in Marcellus Shale • Shell considering “world scale” chemical plant in Marcellus • Multiple trucking industry LNG and CNG truck purchase announcements U.S. Chemical Forecasted Capital Exp Spending Growth in Chemical Production by Market Source: American Chemistry Council Year-end 2011 Situation and Outlook

  13. Expanding Domestic Chemical Production QLTY Chemical Logistics Greater Intermodal Export Volumes QLTY Intermodal (Boasso) Shale Gas Driving Growth Across All QLTY Segments U.S. Chemical Industry More Competitive Shale Gas Exploration Low Natural Gas Prices Increased Hauling of Water & Oil from Shale Gas Wells QLTY Energy Logistics Logistics solutions across the Energy and Chemicals supply chain 12

  14. Boasso’s Growth Opportunity • High growth segment of liquid bulk chemical transportation • ISOs carry more than 50% of intermodal volumes • ISO volumes continue to grow y-o-y • Key gateway in the international chemical supply chain • Benefits from increased chemical plants in U.S. • Organic and acquisition growth opportunities • Greensville Transport acquisition closed in November 2011 • Acquired for $8.6 million North America Intermodal Volumes(1) Potential New Markets • Norfolk, Virginia P • St. Louis, Missouri • Long Beach, California • Cincinnati, Ohio • Memphis, Tennessee • Tampico, Mexico Boasso is a leader in the fast growing international chemical shipping market 13 Source: Intermodal Association of North America (1) Based on data provided by IANA website as of December 2011.

  15. Growth Through Acquisitions Gross Revenue of Food & Chemical Transporters Source: Bulk Transporter May 2011 and Management estimates. Acquisition Targets Disciplined Acquisition Criteria • Energy / water carriers • Chemical carriers • Intermodal carriers or depot providers (Boasso) • Dry bulk carriers • Transloading facility operators • Meets or exceeds ROIC hurdle rate • Accretive to earnings and cash flow in year 1 • Low integration risk • Achieve synergies and potentially affiliate targets • Leverage existing low cost bank revolver Highly fragmented industry provides numerous bolt-on opportunities 14

  16. Recent Acquisition Activity • Greensville Transport (Intermodal) – $8.0 million revenue - Closed Nov. 2011 • Acquired for $8.6 million • Excellent tuck-in acquisition – filled hole in Boasso’s Northeast offering • Norfolk location expected to benefit from Panama Canal expansion • Trojan Vacuum Services (Energy Logistics) – $13.5 million revenue - Closed April 2012 • Acquired for $8.9 million • Expanded Eagle Ford shale presence in Texas • Exclusive access to disposal well assets of Seller • Wylie Bice/RM Resources (Energy Logistics) - $105 million revenue - Pending • $79.3 million purchase price – expected to close in Q2 • Entry into lucrative oil rich Bakken shale • Asset light business model - high owner/operator fleet • Trucking and disposal well asset acquisition

  17. Positioned to Capitalize on Anticipated Improvement in Chemical Fundamentals U.S. Chemicals Revenues(1) Continued Robust Sales Pipeline for QLTY • ($ in billions) • Market leadership position creates competitive advantage • EOBR completion may help improve driver retention • Organic growth – new terminal expansion: • New Orleans • Houston • Continued rate improvement CAGR: 5% U.S. Chemicals Revenues(1) Industry Trends Lead to Capacity Tightening • Anticipated improvement in chemical market fundamentals • Driver shortage keeping capacity outlook rational • Carriers have reduced fleet size • Higher cost of equipment • High average age of equipment • Increased government regulations – CSA 2010 Pricing environment remains favorable as capacity shortage evolves • Defined as sum of Bloomberg consensus calendar year sales estimates for companies in the S&P 500 Chemicals Index and the S&P 400 Chemicals Index. 16

  18. Experienced management team with strong operational background Successfully navigated downturn and poised to benefit from recovery Demonstrated ability to make accretive acquisitions and divest non-core assets Improving free cash flow and efficiently deploying capital Leading Management Team Management has a breadth of transportation experience

  19. Financial Highlights

  20. Solid Business and Financial Profile Simplified Business Modelwith Attractive Growth Prospects Strong Financial Profile • No cash taxes until approximately 2014 – • $77.0 million of NOLs¹ • Extended debt maturity profile • No debt due until 2016 • Improved credit profile • LTM Q1 2012 net leverage of 3.8x • Fewer, stronger affiliates • From high of 53 to 29 affiliates today • 94% of terminals operated by affiliates • High growth, high-margin intermodal business • High-margin growth opportunity in shale markets • Upward earnings and cash flow momentum Investing in Energy Business • Net capex spending will rise in 2012 • High ROIC profile expected to generate rapid payback Favorable earnings and cash flow characteristics • As of 12/31/12. 19 19

  21. Summary of First Quarter 2012 Results Consolidated Adjusted EBITDA • ($ in millions) 13% • Top line revenues up ~6.5% (excluding FSC) • $10 million in new energy business • Solid growth in intermodal • Driver turnover adversely impacting core • Strong earnings and cash-flow vs. Q1 2011 • Leveraging overhead; favorable insurance expense • Consolidated Adjusted EBITDA up ~13% • Solid liquidity profile (3/31/12) • $116.2 million of borrowing capacity available • Liquidity will decline in Q2 to complete acquisitions and meet debt service requirements Consolidated Adjusted EPS 71% Q1 2011 Q1 2012 20 Note: A reconciliation of Consolidated EBITDA and Adjusted EPS can be found in the Appendix.

  22. Strong Margin and Earnings Growth Consolidated Adjusted EBITDA(2) Consolidated Adjusted EPS(2) • ($ in millions) • ($ in millions, except per share amounts) Despite downturn, Adjusted EBITDA margins have improved each year Continued improvement in Consolidated Adjusted EPS CAGR: 11% CAGR: >100% Operating Revenues(1): $670 $560 $606 $628 $638 (1) Excluding fuel surcharge of $145 million, $54 million, $81 million, $118 million and $122 million in 2008, 2009, 2010, 2011 and LTM 3/31/2012, respectively. (2) A reconciliation of Consolidated Adjusted EBITDA and Consolidated Adjusted EPS can be found in the appendix. 21 21

  23. 6.4x 6.3x 5.1x 4.1x 3.8x 2008 2009 2010 2011 LTM 3/31/2012 Capital Structure Enhancement • Enhanced capital structure has led to operational flexibility • Raised $17.6 million of equity in Feb 2011 to de-lever and improve liquidity • Refinanced ABL credit facility in Aug 2011 • New $250 million ABL facility broadened borrowing capacity • Facility matures in 2016 • Covenants enable the ability to opportunistically buy back $22.5 million of 2018 second secured notes • Recently raised $30.5 million in equity to further improve balance sheet and leverage Quality Distribution Debt Maturity Schedule Quality Distribution Debt Maturity Schedule Total Debt / Adjusted EBITDA • ($ in millions) Targeting < 3.5x Total Debt / Adjusted EBITDA by end of 2012 22 22

  24. QLTY Valuation Gap Comparison of QLTY versus Industry(1) EV(2) / LTM EBITDA(3): EV(2) / LTM Adjusted EBITDA(3): LTM Net Capex as Percentage of LTM Revenue(4)(5) Energy Capex Tangible Assets(6)/ LTM Revenue(5): ROIC(7): QLTY multiple still does not reflect its transition to a high ROIC, asset-light business model • Note: The companies making up the two groups above are: • Asset-light Logistics: C.H. Robinson Worldwide, Echo Global Logistics, Expeditors International of Washington, Forward Air and UTi Worldwide. • Other companies may calculate figures and statistics (or the components thereof) used herein differently than we do and, as a result, such figures and statistics may not be directly comparable across companies. In addition, most of QLTY’s competitors are not public, and these companies may not be directly comparable QLTY. You should not place undue reliance on such comparisons. • Enterprise value is sourced from CapitalIQ and is based on the stock price as of 5/13/12 and the most recently available balance sheet data. • (3) Reflects data for the most recently publicly available LTM period, sourced from CapitalIQ for all companies and $76.4 million for QLTY for the LTM 3/31/12 period. • (4) Net Capex is calculated as gross capital expenditures less proceeds from asset disposals and is sourced from company filings. Data is for the most recently available LTM period for each company. • (5) Revenues are sourced from CapitalIQ for the most recently available LTM period and have not been adjusted for fuel surcharges for all companies including QLTY. • Tangible assets for each company are calculated as total assets less intangible assets as of the date of the most recently available balance sheet, sourced from CapitalIQ. • ROIC is calculated as the most recently publicly available LTM EBIT sources from CapitalIQ (adjusted EBIT of $59.8 million as of 12/31/11 for QLTY) less taxes (assuming 39.0% tax rate) divided by most recently publicly available sum total debt and book value of equity. • Excludes $19.5 million of energy business growth capex for LTM 3/31/2012. 23 23

  25. Leading Management Team Diverse Group of Blue-Chip Customers in Attractive Markets Asset-Light and High ROIC Business Model SignificantOrganic and Acquisition-Driven Growth Opportunities Investment Highlights Strong Profitability and Free Cash Flow Generation Logistics and Intermodal Leader for the Chemical and Energy Markets

  26. Q&A

  27. Appendix

  28. Adjusted EBITDA Reconciliation 27 Source: Company filings and management. Note: Numbers may not add up due to rounding. 27

  29. Adj. Net Income and Adj. EPS Reconciliation Source: Company filings and management. Note: Numbers may not add up due to rounding.

  30. Energy Logistics Asset-Light Business Model Business Characteristics • Diversification of customer base and industry exposure • Customers: Blue-chip E&P companies • Equipment utilization ~3x chemical (24/7 operations) • Company deploying capital in the business to capture growth • Expects to successfully affiliate and continue to reduce capital employed • QLTY affiliates transport recovered fracking fluid to disposal sites • QLTY affiliates transport fresh water to frac shale sites • Fresh water is used for hydraulic fracturing process • Recovered fracking fluid stored on-site prior to disposal

  31. Asset-Light Business Model Affiliates Responsibilities • Sales force • Insurance • Technology/Back Office • Regulatory oversight • Weekly cash settlements • Driver • Tractor operations • Trailer maintenance • Terminals • Fuel Equipment • Trailers • Average new cost of ~$60,000 • Useful life of 15-30 years • Leased to affiliates at attractive economics • Tractors • Average new cost of ~$110,000 • Useful life of 5-7 years • Required to lease trailers from QLTY Revenue Split(1) QLTY revenue split 15% (+) Trailer rent: 8% Net revenue: 23% Affiliate revenue split 85% (-) Trailer rent: (8%) Net revenue: 77% Business Model • Asset light – low net capex • Control of customer relationships • Highly variable cost structure • Purchasing synergies from scale • Non-competes drive high retention • Responsible for maintaining trailer assets • Key affiliates generally well-capitalized for growth Source: Management estimates. Note: Represents scenario where affiliate does not own trailers. (1) Represents typical revenue sharing and trailer rent arrangement with the affiliate.

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