MERGER SUPPLEMENTAL

AGREEMENT

(Salt Lake City)

Between the

UNION PACIFIC RAILROAD COMPANY and the

UNITED TRANSPORTATION UNION

This agreement is entered into as an amendment to the Arbitration Award dated April 14,1997. The parties recognize that certain adjustments would benefit both parties to amend that award.

Therefore it is agreed:

I.        Article IV (A) (2) of the Salt Lake Hub proposal shall read as follows:

"These operations shall be run as three separate pools, however if a pool drops to 5 or fewer turns the Carrier may abolish that pool and run the traffic from the extra board until such time as the traffic warrants six or more pool turns in that pool."

II.       All employees currently in the Hub and who were working an assignment in the Hub on July 1,1997 shall be given automatic certification of New York Dock wage protection. This protection is wage only and hours will not be taken into account. This protection will start with the first of the month following the implementation date of this supplemental agreement. The employees must comply with the requirements associated with New York Dock conditions or their protection will be reduced for such items as layoffs, bidding/displacing to lower paying assignments when they could hold higher paying assignments, etc. The questions and answers attached hereto shall describe the method of deduction when laying off or not available. This provision does not apply to employees borrowed out into the Hub nor those forced into the Hub and leaving the Hub when their services are no longer needed.

III.      Trainmen required to relocate under this agreement will be governed by the relocation provisions of New York dock. In lieu of the New York dock provisions, an employee required to relocate may elect one of the following options:

1.       Non-homeowners may elect to receive an "in lieu of allowance in the amount of $10,000 upon providing proof of actual relocation.

2.       Homeowners may elect to receive an "in lieu of allowance in the amount of $20,000 upon providing proof of actual relocation.

3.       Homeowners in Item 2 above, who provide proof of a bona fide sale of their home at fair value at the location from which relocated, shall be eligible to receive an additional allowance of $10,000.

(a) This option shall expire five (5) years from date of application for the allowance under Item 2 above.      .

(b) Proof of sale must be in the form of sale documents, deeds, and filings of these documents with the appropriate agency.

4.       With the exception of Item 3 above, no claim for an "in lieu of relocation allowance will be accepted after two (2) years from date of implementation of this agreement.

5.       Under no circumstances shall an employee be permitted to receive more than one (1) "in lieu of relocation allowance under this implementing agreement.

6.       Trainmen receiving an "in lieu of relocation allowance pursuant to this implementing agreement will be required to remain at the new location, seniority permitting, for a period of two (2) years.

7.      There will be no pyramiding of benefits.

IV.      National rate progression provisions shall be waived for all trainmen on the roster on July 1,1997 and still working in the Hub, who hold prior rights in the Salt Lake Hub. All others shall be governed by the National rate progression provisions.

V.      Article VII Section D of the award which covered forcing trainmen outside the hub for a one year period is deleted.

VI.      If new pool operations are implemented that run over two prior right existing runs then those holding prior rights to the old runs shall hold prior rights to the new runs in the ratio of miles run. For example, if Ogden-Milford operations are implemented then employees with prior rights Salt Lake-Milford and Salt Lake-Ogden will hold prior rights to the new run based on the ration of miles run.

VII.     In an effort to keep employees from haying to relocate to locations away from home when there are other employees with seniority dates prior to the implementation date of this agreement available at the other locations it is agreed that the following shall govern:

1.       Salt Lake Hub:        When permanent vacancies occur on a regular position or guaranteed extra board, employees with prior or secondary rights to the assignment may elect by application to fill the vacancy in seniority order. If the vacancy is not filled in the above manner it will be filled as follows:

A.       If no prior right applications are received, then the senior applicant who holds prior rights in the Hub, but not to the assignment, will be assigned. If no such applications are received then the junior employee on a reserve board who holds prior rights to the assignment will be recalled.

B.       If no applications are received from employees holding any prior rights and if no employee with prior rights to the vacancy is on a reserve board then the junior employee on any reserve board within 50 miles of the vacancy shall be recalled to the assignment. Those extra boards that are filled off the dovetail roster without considering prior rights shall be filled by the junior employee on a reserve board within 50 miles of the vacancy if there are no applications.

C.       For the purposes of this agreement, reserve boards for the various districts shall be considered as being at the following locations:

I.      UPED 8th district      Ogden

ii.      WP      Salt Lake City

iii.      SP      Ogden

iv.      UPldaho      Salt Lake City

v.      DRGW      Salt Lake City

vi.      UP So. Central      (3) Salt Lake City, Milford, Las Vegas

Note 1: The UP So. Central trainmen can only hold the reserve board at the location where assigned on November 1,1996.

Note 2: Ogden is within 50 miles of Salt Lake City and Salt Lake City is within 50 miles of Provo.

D.      If the vacancy cannot be filled pursuant to the above provisions, then the most junior employee on any of the reserve boards will be forced to the assignment or permitted to exercise seniority to a position held by another employee with the end result a junior employee forced to the assignment. If there are no employees on any reserve board In the Hub then the senior furloughed trainman will be recalled.

VIII. As a point of clarification, all pool freight operations in the Salt Lake Hub shall be governed by the same provisions with regards to ITD/FTD, HAHT, meal payments for time spent at the far terminal, runarounds, overtime and $1.50 in lieu of eating en route, based on the employees seniority date and eligibility for those provisions.

IX.      Premium payments required by former SP/DRGW/WP Agreements covering Life Insurance and/or Disability Insurance will continue for those SP/DRGW/WP trainmen/yardmen/hostlers who are covered by this supplemental agreement and who were covered under those plans on June 30,1997. These payments will be maintained for such employees for six years from the implementation date of this agreement.

X.       Article IV (B) (1) Twenty-Five Mile Zone of the Salt Lake arbitration proposal concerning the twenty-five mile zone is reinstated as part of the amended award except for Green River and Pocatello. The 25 mile zone will not be implemented at Yermo until merger negotiations are complete for the area west of Yermo and a similar provision is incorporated into that Hub.

XI.      Article VIII (E) of the Salt Lake Hub proposal shall read as follows.

" 50% of the regularly assigned yard assignments within the Salt Lake Hub may be run as foreman only without any work or other restrictions. Extra yard assignments shall not be run foreman only. All pool freight service (assigned and unassigned, through and non-through) may work conductor only without any work or other restrictions in the switching limits of any initial or final terminal. These assignments shall be limited to three work events en route as defined in the UPED Crew Consist Agreement. Assignments with additional crew members shall have no restrictions of any kind, either in the initial and final terminal or en route. Yard Foreman who work without a helper/switchman will be entitled to an additional $10.00 special allowance. This allowance shall apply to all employees who are on the roster July 1,1997.

Note: The references to "without restrictions" and "no restrictions" in Article XI above refers to restrictions that are associated with crew consist and not with road/yard rules that would apply whether the crew was a short crew or a standard crew.      '

XII. All questions and answers to the Carrier's proposals that were deleted by the arbitration award are reinstated except for Q&A 14 and 15 which remain deleted. If, however, any of those Q&A's conflict with this supplemental agreement then this supplemental agreement shall govern.

XIII.    Trainmen/switchmen, not currently eligible to hold a reserve board position, who are working in the Salt Lake Hub and with a trainman seniority date prior to July 1, 1997 shall be eligible to hold a reserve board position, seniority permitting, in accordance with the provisions of the UPED reserve board agreement. The reserve board rate shall be 70% of the yard foreman rate of pay for these employees. This provision does not apply to employees borrowed out into the Hub nor those forced into the Hub and leaving the Hub when their services are no longer needed.

XIV.   This agreement is entered into without precedent or prejudice to either party and the provisions of this supplemental agreement shall not be cited or referred to by either party in any proceeding other than a dispute involving the interpretation of this agreement.

This agreement is signed this 18^th day of September 1997 and is effective the 1st day of October, 1997.

FOR THE ORGANIZATION:                       FOR THE CARRIER:

G. A. Eichmann (signature)             W. S. Hinckley (signature)

General Chairman UTU                  General Director Labor Relations