TABLE OF CONTENTS
                            -----------------

Rule  1 - Scope. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
Rule  2 - Seniority. . . . . . . . . . . . . . . . . . . . . . . . . . . .46
Rule  3 - Seniority Classes. . . . . . . . . . . . . . . . . . . . . . . .47
Rule  4 - Seniority Rosters & Working Zones. . . . . . . . . . . . . . . .48
Rule  5 - Guarantee Work Week. . . . . . . . . . . . . . . . . . . . . . .50
Rule  6 - Pay Basis, Shifts, Starting Times and Meal Periods . . . . . . .51
Rule  7 - Rates of Pay . . . . . . . . . . . . . . . . . . . . . . . . . .55
Rule  8 - Compensatory Time. . . . . . . . . . . . . . . . . . . . . . . .56
Rule  9 - Beginning and Ending Day/Hours of Service. . . . . . . . . . . .58
Rule 10 - Qualifications for Positions . . . . . . . . . . . . . . . . . .60
Rule 11 - Filling Vacant Positions . . . . . . . . . . . . . . . . . . . .62
Rule 12 - Cancellations/Abolishments . . . . . . . . . . . . . . . . . . .65
Rule 13 - Return to Service. . . . . . . . . . . . . . . . . . . . . . . .66
Rule 14 - Displacements. . . . . . . . . . . . . . . . . . . . . . . . . .67
Rule 15 - Time Limit on Claims Not Involving Discipline. . . . . . . . . .69
Rule 16 - Examination, Training, Qualifying. . . . . . . . . . . . . . . .71
Rule 17 - System Production Gangs. . . . . . . . . . . . . . . . . . . . .72
Rule 18 - Away From Home Expenses. . . . . . . . . . . . . . . . . . . . .77
Rule 19 - Discipline . . . . . . . . . . . . . . . . . . . . . . . . . . .79
Rule 20 - Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . .82
Rule 21 - Sick Leave Days. . . . . . . . . . . . . . . . . . . . . . . . .84
Rule 22 - Health and Welfare . . . . . . . . . . . . . . . . . . . . . . .85
Rule 23 - Vacation . . . . . . . . . . . . . . . . . . . . . . . . . . . .86
Rule 24 - Retention of Seniority . . . . . . . . . . . . . . . . . . . . .90
Rule 25 - Leaves of Absence. . . . . . . . . . . . . . . . . . . . . . . .92
Rule 26 - Bereavement Days . . . . . . . . . . . . . . . . . . . . . . . .94
Rule 27 - Attending Court, Inquests, Investigations. . . . . . . . . . . .95
Rule 28 - Jury Duty. . . . . . . . . . . . . . . . . . . . . . . . . . . .96

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Rule 29 - Physical Condition - Board of Doctors. . . . . . . . . . . . . .97
Rule 30 - Use of Personal Auto While on Duty . . . . . . . . . . . . . . .99
Rule 31 - Application for Employment . . . . . . . . . . . . . . . . . . 100
Rule 32 - Duly Accredited Representative . . . . . . . . . . . . . . . . 101
Rule 33 - Union Shop Agreement. . . . . . . . . .. . . . . . . . . . . . 102
Rule 34 - Dues Deduction . . . . . . . . . . . . . . . . . . . . . . . . 109
Rule 35 - BMWE Political League Deductions . . . . . . . . . . . . . . . 115
Rule 36 - Employee Information . . . . . . . . . . . . . . . . . . . . . 119
Rule 37 - Moratorium . . . . . . . . . . . . . . . . . . . . . . . . . . 120
Rule 38 - Printing of Agreement. . . . . . . . . . . . . . . . . . . . . 120

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<PAGE>
                                 RULE 1
                                  SCOPE
                                 ------

1.1  The Rules contained shall govern the hours of service, working
     conditions and rates of pay of the Engineering Department Employees
     represented by the Brotherhood of Maintenance of Way Employes
     (BMWE) who are working on Track, Bridges and Buildings on The New
     York, Susquehanna and Western Railway Corporation (Carrier).  These
     employees will perform the work generally recognized as Maintenance
     of Way work, such as inspection, construction, demolition,
     dismantling of bridges, culverts, buildings and other structures,
     tracks, fences and roadbed in accordance with the Carrier s rules,
     procedures and policies.  It is also understood that work not
     covered by this Agreement which was being performed on the NYS&W
     Railway prior to this Agreement by past practice or agreement will
     not be removed from the regular work assignments and work that was
     previously done by others by past practice or agreement, such as
     Track Inspection and maintenance of insulated joints, may continue
     to be done by others.

1.2  In the event the Carrier plans to contract out work within the
     scope of this Agreement, except in emergencies, the Carrier shall
     notify the General Chairman  involved, in writing, as far in
     advance of the date of the contracting transaction as is
     practicable and in any event not less than fifteen (15) days prior
     thereto.    Emergencies" apply to fires, floods, earthquakes,
     derailments and like circumstances resulting in removal of track
     from service.

1.3  If the General Chairman, or his representative, requests a meeting

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<PAGE>                                       

     to discuss  matters relating to the said contracting transaction,
     the designated representative of the Carrier shall promptly meet
     with him for that purpose.  Said Carrier and Organization
     representatives shall make a good faith effort to reach an
     understanding concerning said contracting but, if no understanding
     is reached, the Carrier may nevertheless proceed with said
     contracting and the Organization may file and progress claims in
     connection therewith.

1.4  No such claims will be filed if the General Chairman or his
     representative fails to request a meeting as provided in Rule 1.3
     or where the contract work is for any of the following:

          -    Emergencies;

          -    Installation, repair or maintenance of fencing;

          -    Installation of continuous welded rail, over half track mile
               in length;

          -    Construction, repair, maintenance, alteration or
               demolition of buildings;

          -    Salvage of rail materials not to be reused by the NYS&W;

          -    Operation of equipment that reasonably requires
               specialized qualifications where no qualified employee is
               available;

          -    Operation of equipment of a type not owned by the Carrier
               that is not available to rent without an operator;

          -    Site preparation below the base of the ballast;

          -    Installation, repair, maintenance or removal of non-rail
               facilities, including but not limited to utilities,
               pipelines, data transmission facilities, tenants
               facilities and terminal facilities, but not including any
               track work.

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                                 RULE 2
                               SENIORITY
                               ---------
2.1  Seniority Date
     Seniority begins at the time the employee s pay starts.  If two (2)
     or more employees start to work on the same date, their seniority
     rank on the roster will be in alphabetical order.  An employee
     assigned to a position of higher class than trackman will begin to
     earn seniority as a trackman on the same date.

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<PAGE>

                                 RULE 3
                           SENIORITY CLASSES
                           -----------------
                                  
     The seniority classes and primary duties of each class are as follows:

3.1  Track Department 
          Foreman:
          Direct and work with employees assigned under his jurisdiction. 
          Trackman:
          Construct, dismantle, maintain, repair and inspect track and
            appurtenances thereto.

3.2  Equipment Operators
          Operate the following:
          Class One - Mark III Tampers, Crane (20 ton), Grapple Truck,
          Fuel Truck (HazMat CDL), Stork, Tractor Trailer, Grad-All with
          Hyrail, Geometry Car, Combination Dump Truck, Trailer and
          Backhoe, TR-10 Tie Extractor-Inserter.
          Class Two -  Spiker, Loram Tie Inserter, Tie Crane, Scarifier,
          Mark I Tamper, Front-end Loaders, Dozers, Backhoes, Ballast
          Regulators, Forklift, Mack Tilt Bed, Boom Truck, 3-way Dump,
          Jordan Spreader, Snow Plow, Brushcutter.

     Additional equipment may be added by agreement of the parties.

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<PAGE>

                                 RULE 4
                    SENIORITY ROSTERS & WORKING ZONES
                    ---------------------------------

4.1  Track Rosters
     Single rosters of employees will be created for each of the
     following classes within the Track category.  For each roster,
     employees will be listed in order of their seniority in that
     particular class.
        A)   Foremen, Trackmen
        B)   Equipment Operators

4.2  All employees will designate a home Seniority Zone: either Northern
     or Southern.   Employees may change their zone each year between
     January 1st and March 1st by notifying the Chief Engineer and
     General Chairman.  In the selection of a work zone, each individual
     must be prepared to cover assignments outside of normal work hours,
     which include nights and weekends.

4.3  Rosters of Employees will be issued each year by January 31 and
     sent to all active employees with their paychecks and to all
     furloughed employees and the General Chairman by certified mail and
     will also be posted at all Headquarters.  Protests to the Annual
     Rosters must be addressed to the Chief Engineer and the General
     Chairman by March 1st of each year.  Decisions will be rendered
     within thirty (30) days of date of such protest. Protests not
     submitted as specified will not be considered.  Typographical
     errors may be corrected at any time.

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4.4  No changes shall be made to the roster, other than pursuant to Rule 2,
     without a conference and agreement between the Chief Engineer and the
     General Chairman.

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                                  RULE 5                              
                           GUARANTEE WORK WEEK
                           -------------------

5.1  Subject to the provisions of Rules 12.1 and 12.5, the Carrier will
     make available to all employees holding advertised positions an
     opportunity to earn a minimum of forty (40) hours pay per work
     week, including all pay pursuant to Rules 8, 20, 21, 23, 26, 27 and
     28.  For twenty-three (23) employees (the Basic Force), this
     provision will apply year round.  It is agreed that, in the event
     the Basic Force needs to be adjusted, the provisions of Rules 5.5
     and 5.6 will apply.

5.2  The Carrier will establish a work week of forty (40) hours,
     consisting of five (5) days of eight (8) hours each with two (2)
     consecutive days off in each seven (7) or 4 days of 10 hours each
     with three consecutive days off in each seven (7).

5.3  Except as otherwise provided in this Agreement, all reference to
     days shall mean calendar days.

5.4  For positions, the duties of which can reasonably be met in five
     (5) days, the rest days will be Saturday and Sunday.  In the event
     the Carrier is operationally prohibited from assigning Saturday and
     Sunday rest days, assigned rest days will be Friday and Saturday or
     Sunday and Monday.

5.5  In the event there is a need to adjust the Basic Force, the Chief

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<PAGE>

     Engineer will notify, in writing, the General Chairman within
     thirty (30) days of such change.  Such notification will fully
     describe the reason/s for such change, such as decline in traffic
     or a sale of portion of Carrier s railroad.

     The Organization may, within ten (10) days of such notification,
     request a conference to evaluate and clarify the reason/s for such
     change.

     If the parties fail to agree on any modification of the Basic
     Force, the matter shall be referred to a Special Board of
     Adjustment in which the burden shall be upon the Carrier to prove
     it would incur a substantially adverse effect if the proposed
     modifications were not put into effect.

5.6  In the event a request of the Carrier for modification of the
     Agreement is progressed to a Special Board of Adjustment, and a
     final decision has not been reached by the Neutral Arbitrator
     within thirty (30) days of the date of the initial conference
     referenced in Rule 5.5, the Carrier may nevertheless put the
     proposed modification into effect.  In the event the Arbitrator
     decides that the Carrier would not be substantially affected by the
     change in conditions, any modifications made shall be discontinued
     within fifteen (15) days of the date of the decision and the Force
     shall be readjusted.

5.7  Any dispute or controversy with respect to the interpretation,
     application, or enforcement of the provisions of this Agreement,

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<PAGE>

     which has not been resolved within sixty (60) days other than
     modification, may be submitted by either party to a Special Board
     of Adjustment.

5.8  The Parties agree to meet and establish a Special Board of
          Adjustment within 30 days of notice by either party.

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                                RULE 6                              
          PAY BASIS, SHIFTS, STARTING TIMES AND MEAL PERIODS
          --------------------------------------------------

6.1  Payment for all service performed for the Carrier will be based on
     the hourly rate of pay as specified in this Agreement.

6.2  Eight (8) hours shall constitute a day's work for all regularly
     assigned employees, exclusive of lunch period.

6.3  One, two or three shifts may be established where necessary to meet
     service requirements.  The starting time of any shift or position
     may be changed on thirty-six (36) hours notice to the employees
     effected and not more often than every seven (7) days.  When a
     single shift is assigned, it will start work between 6:00AM and
     8:00AM.  The starting time for employees assigned to a second shift
     will be immediately after the end of the first shift.  When three
     (3) shifts are regularly established no shift will have a starting
     time between 12:00 o'clock midnight and 6:00AM.  These starting and
     notice times may be adjusted by mutual agreement between the local
     chairman and the Vice President Engineering.

6.4  Meal period will be between the end of the fourth hour and
     beginning of the sixth hour after starting time.  The meal period
     shall be thirty (30) minutes.

6.5  Employees shall not be required to work more than six (6) hours
     after their first meal period without being furnished meals by the

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<PAGE>

     Carrier.  Subsequent meal periods will be allowed at five (5) hour
     intervals.  The second and subsequent meals shall be furnished by
     the Carrier.  If the meal period is not afforded within the allowed
     or agreed time limit and is worked, it will be paid for at the
     straight time hourly rate and twenty (20) minutes allowed for lunch
     at the first opportunity without loss of pay.

6.6  Except as provided in Rule 17 (System Production Gangs), employees'
     time will begin and end at fixed assembling points such as
     toolhouses or shops.

6.7  Each of these assembly points will be supplied with lockers,
     washing and toilet facilities, proper heating, electrical fixtures,
     table and benches and will be maintained in a clean and sanitary
     condition.

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                                 RULE 7                              
                              RATES OF PAY
                              ------------

                              Hourly Rates
                              ------------

                               Operators    Operators
                    Foreman      Class A      Class B     Trackman
               ------------ ------------ ------------ ------------

1-1-95                15.25        13.75        12.75        11.75     

1-1-96                15.70        14.16        13.13        12.10

1-1-97                16.18        14.59        13.53        12.47

1-1-98                16.66        15.02        13.93        12.84

1-1-99                17.16        15.48        14.35        13.22

                    Trackman Entry Level Rate Schedule
                    --------------------------------------
                    First Year          90% of hourly rate
                    Second Year         95% of hourly rate
                    Third Year         100% of hourly rate

     Employees covered by rate progression will be credited with two (2)
     months of employment for each month he performs compensated service
     provided:
     A)   Not more than twelve (12) months of service will be credited
          in any twelve (12) consecutive month period).

     B)   An employee cannot advance into the next rate progression
          category until at least twelve (12) months after establishing
          seniority, and on that anniversary date forward.

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                                 RULE 8
                            COMPENSATORY TIME
                            -----------------

8.1  Time worked (i) in excess of 40 hours in a work week (ii) or on a
     holiday shall be paid at the hourly rate of pay as specified in
     this Agreement.  In addition, half hour of compensatory time off with
     pay ( Compensatory Time ) shall be accrued for each such hour with
     proportionate accruals for partial hours.

8.2  Compensatory Time will be paid for at the hourly rate of pay in
     effect at the time it is taken.

8.3  Compensatory Time shall be added to the employee s vacation
     allowance, and shall be subject to and governed by Rule 23.2, 23.4,
     23.5, 23.6, 23.8, 23.9, and 23.10 of the Vacation provisions of
     this Agreement.  Notwithstanding the foregoing, the Carrier, in its
     sole discretion, may allow an employee to use Compensatory Time
     without regard to Section 23.4 of the Vacation provisions of this
     Agreement.

8.4  Employees called to perform work not continuous with the regular
     work period will be allowed a minimum of three (3) hours work.

8.5  When necessary to work employees under this Rule, the senior
     available qualified employees will be called according to the
     following:
          A)   Preference to overtime work on a regular work day
               which precedes or follows and is
               continuous with a regular assignment
               shall be to the senior available

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<PAGE>
               qualified employee of the gang or the
               employee assigned to that work.

     B)   Preference to overtime work other than in A) above,
          shall be to the senior available qualified employee
          at the headquarters who ordinarily and customarily
          performs such work.  In the case of a specific
          project, the employees assigned to that project
          will be given preference.

8.6  Notwithstanding other provisions of this Agreement, in the event
     that an employee working on a four-ten hour day schedule works more
     that ten hours on any of the first three days of a week, the
     Carrier may proportionately reduce his fourth day, but not to less
     than eight hours.

8.7  Employees will be compensated as if on continuous duty in all cases
     where the release from duty does not exceed one (1) hour.

8.8  This Rule shall not apply prior to October 16, 1995.

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                                 RULE 9
                BEGINNING AND ENDING DAY/HOURS OF SERVICE
                -----------------------------------------

9.1  Employees' time will commence at the time they report for duty at
     their headquarters, except System Production Gangs, and shall
     continue until they are relieved from duty by the Carrier.

9.2  Employees assigned to positions scheduled to work eight (8) hours
     per day exclusive of meal periods, five (5) days per week will have
     two consecutive days off.  On positions the duties of which can
     reasonably be met in five (5) days, the rest days will be Saturday
     and Sunday.  
9.3  Employees assigned to positions scheduled to work ten (10) hours
     per day exclusive of meal periods, four (4) days per week will have
     three (3) consecutive days off.  The rest days will be either
     Friday, Saturday and Sunday or Saturday, Sunday and Monday, unless
     operationally prohibited.

9.4  Track Inspection and FRA patrols may be established with rest days
     being either Friday and Saturday or Sunday and Monday, in the case
     of five (5) day work weeks and either Thursday, Friday and Saturday
     or Sunday, Monday and Tuesday in the case of four (4) day work
     weeks.

9.5  For vacation purposes or any other situation where work days are
     counted as accumulative days, employees working a four (4) ten (10)
     hour day work week, will be credited with working five (5) work
     days in that work week.

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9.6  Where employees are working a four (4) day, ten (10) hour per day
     work week and a holiday falls on a work day in that week, they
     shall be paid ten (10) hours holiday pay for that holiday providing
     the bridging requirements of the Holiday Rule are met.

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                                 RULE 10
                      QUALIFICATIONS FOR POSITIONS
                      ----------------------------

10.1 Effective with this Agreement, employees may utilize their
     seniority in any direction, subject to their being qualified.

10.2 In making application for an advertised position or vacancy, or in
     the exercise of seniority, employees may be required to give a
     reasonable practical demonstration of their qualifications to
     perform the duties of the position.

10.3 In the event employees are required to give a reasonable practical
     demonstration of their qualifications for a position, the Carrier
     must give uniform job related tests based on job related criteria
     in order to ascertain initial qualifications for positions.

10.4 Disqualification of employees for failure to maintain required
     licenses, rules qualifications, and/or FRA certifications, or for
     medical reasons will not be considered discipline.

10.5 When on-the-job training opportunities to operate Maintenance of
     Way machinery occur in a gang, employees with that gang who request
     such training in writing to the Foreman or higher level supervisor
     of that gang shall be given the opportunity in seniority order. 
     Such employees shall first be given the opportunity to qualify on
     rules, as appropriate, and then, if so qualified, the opportunity
     to train with a qualified machine operator as requirements of
     service permit.

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     Should an employee so covered fail to make sufficient progress
     and/or qualify within a thirty (30) day period, he will be removed
     from such training and will be ineligible for consideration for
     future on-the-job training on the involved and similar machinery
     for a period of one (1) year unless otherwise agreed to by the
     General Chairman and Chief Engineer.  If the employee so removed
     disputes his removal, the employee, or his representative may file
     a claim.  After removal, the employee must return to his former
     position unless it has been abolished or filled by a senior
     employee, in which case he may exercise seniority.


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                                 RULE 11
                        FILLING VACANT POSITIONS
                        ------------------------

11.1 In the assignment of employees to positions under this
     Agreement, qualification being sufficient seniority shall
     govern.

11.2 Positions subject to advertisement will be newly created
     permanent positions and temporary positions expected to be
     available for more than thirty (30) work days and will be
     advertised for at least seven (7) calendar days. 
     Advertisements shall be posted on Monday and shall close at
     5:00PM on the following Monday.  Bids which are postmarked or
     received anytime during the application period shall be
     accepted.

11.3 Advertisements of positions will be distributed to all
     locations.  Employees  will submit bids for positions to the
     Chief Engineer on a form provided by the Carrier and must
     assure that such bids are postmarked by the closing date
     specified on the job advertisement.

     Bid for a position advertised under this Rule must be filed
     with the official whose name appears on the advertisement. 
     Each furloughed employee shall be an automatic bidder for
     advertised positions for which he has seniority and is
     qualified, in his seniority territory within fifty (50) miles
     from home.

11.4 Advertisements will specify location of position, hours of
     service, rest days, type of machine,  closing date of bid,
     general description of the work and headquarters.

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11.5 Positions will be awarded to the senior qualified employee
     bidding for same. Notices of positions awarded will be posted
     within seven (7) calendar days of the closing date specified
     on the advertisement.  Employees awarded positions will occupy
     those positions the first Monday following such award. All
     awards will be made on the same day after the closing day
     specified. This Rule shall not be construed so as to require
     the placing of employees on their awarded positions when
     properly qualified employees are not available at the time to
     fill their places, but physical transfers must be made within
     ten (10) days, or such longer periods as may be mutually
     agreed upon by the Chief Engineer and the General Chairman or
     his authorized representative.

11.6 A position or vacancy may be filled temporarily pending
     assignment.  When vacancies occur, the senior qualified
     available employee will be given preference.  

     In the event no requests are received, the Carrier may assign
     the junior employee who must accept the assignment.

11.7 An advertisement may be canceled within seven (7) days from
     the date advertisement is posted.

11.8 An employee who desires to withdraw his bid or application for
     an advertised position must file his request, in writing, with
     the official whose name appears on the advertisement within
     seven (7) days from the date the advertisement is posted.

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<PAGE>

11.9 Copy of advertisements, awards, and abolishments will be
     furnished to the General Chairman or his designated representative.

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                                 RULE 12
                       CANCELLATIONS/ ABOLISHMENTS
                       ---------------------------

12.1 Notice of force reduction or abolishment of positions shall be
     given not less than five (5) working days (four (4) working
     days for four (4) day gangs) in advance and such notice shall
     be promptly posted identifying the positions to be abolished.
     Employees whose positions are abolished must fulfill the
     requirements of Rule 14  (Displacements) of this Agreement.

12.2 The Carrier has the right to cancel any assignment provided
     the employee(s) affected are notified at least twelve (12)
     hours prior to scheduled starting time.

12.3 A copy of the notice shall be furnished to the designated
     union representative.

12.4 Employees affected by cancellation of their assignments will
     be paid for the number of hours necessary to meet the forty
     (40) hour guarantee of Rule 5 (Guarantee Work Week) of this
     Agreement.

12.5 The Carrier has the right at any time to abolish or cancel any
     assignment due to emergencies such as flood, snow storm,
     hurricane, tornado, earthquake, fire, or labor dispute,
     provided the Carrier's operations are suspended in whole or in
     part. Such assignments will be restored as soon as possible
     once the emergency has ended. The provisions of Rule 5
     (Guarantee Work Week) of this Agreement will not apply to
     employees whose assignments are canceled under this paragraph.

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                                 RULE 13
                            RETURN TO SERVICE
                            -----------------

13.1 An employee not in service will be subject to return to work
     from furlough in seniority order in any class in which he
     holds seniority in his working zone. If he fails to return
     within ten (10) days from the date notified by certified mail
     to his last recorded address for a position or vacancy of
     thirty (30) days or more duration, he will forfeit all
     seniority under this Agreement. Forfeiture of seniority under
     this paragraph will not apply when an employee has furnished
     satisfactory evidence to the officer signatory to the
     notification that failure to respond within ten (10) days was
     due to conditions beyond his control. Copy of recall letter
     shall be furnished the designated union representative. All
     employees will be required to designate a home Seniority Zone
     which will be used for recall purposes.

                                    - 66 -
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                                 RULE 14
                              DISPLACEMENTS
                              -------------

14.1 An employee whose position is abolished may exercise his
     seniority to any position for which he is qualified held by a
     junior employee within seven (7) calendar days after the
     effective time and date of abolishment.  An employee who is
     displaced may exercise his seniority to any position for which
     he is qualified held by a junior employee within seven (7)
     calendar days after the time and date of displacement.
     Displacements must occur prior to the start of the shift and
     an employee reporting to the supervisor in charge of the gang
     in which the displacement is to be made prior to shift start
     will be allowed a displacement on that date.

14.2 An employee who elects to exercise seniority may exercise
     seniority to any position for which he is qualified by bid or
     displacement without loss of seniority.

14.3 An employee whose regular position is abolished or who is
     displaced from his regular position while on leave of absence,
     sick leave, vacation or suspension may, within seven (7)
     calendar days after his return, exercise his seniority to any
     position for which he is qualified held by a junior employee.

14.4 An employee returning from a leave of absence, sick leave,
     vacation or suspension may return to his former position or,
     within seven (7) calendar days after his return, may exercise
     his seniority to any position for which he is qualified and
     holds seniority which was bulletined and assigned in his
     absence to a junior employee.

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14.5 Employees who fail or are unable to exercise their seniority
     will be considered furloughed.

                                    - 68 -
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                                 RULE 15
              TIME LIMIT ON CLAIMS NOT INVOLVING DISCIPLINE
              ---------------------------------------------

15.1 All claims for compensation alleged to be due must be made in
     writing no later than fourteen (14) days from the date of the
     occurrence on which the claim is based.  The claimant, or his
     duly accredited representative, must submit two (2) copies of
     the claim containing the information specified below to a
     representative of the Carrier.  The representative of the
     Carrier who receives the copies must acknowledge receipt by
     signing and dating them and returning the duplicate copy to
     the claimant or his duly accredited representative.  If not
     presented in the manner outlined in this paragraph, a claim
     will not be subject to payment or denial.

15.2 To file a claim, a claimant or his duly accredited
     representative will be required to furnish sufficient
     information to identify the basis of claim, such as:
        1)    Name, Occupation
        2)    On and off duty times.
        3)    Date and time that work was performed.
        4)    Location and details of work performed on which claim is
                based.
        5)    Claim being made, rule, if known, and reason supporting
                claim.

15.3 When a claim for compensation alleged to be due is not
     allowed, or should payment be made for less than the full
     amount claimed, the claimant will be so informed in writing
     within fourteen (14) days from the date the claim is received. 
     If claimant is not so notified, the claim will be allowed, but
     such payment will not validate any other such claim nor will
     such payment establish any precedent.

                                    - 69 -
<PAGE>

15.4 All time claims which are denied in whole or in part within
     the proper time limit may be appealed by the BMWE General
     Chairman to the Carrier's highest designated appeals officer
     within sixty (60) days from the date of denial.  Within sixty
     (60) days from receipt of such appeal, a date, time and place
     for conference will be set. Decision on appeal will be made at
     conference or no later than thirty (30) days thereafter.

15.5 The decision of the Carrier's highest designated appeals
     officer will be final and binding unless within six (6) months
     of such final denial the claim is disposed of on the property
     or proceedings for disposition of the claim are instituted by
     the BMWE to a tribunal having jurisdiction by law or
     agreement.

15.6 Carrier officers designated to receive claims and appeals will
     be specified by the Chief Engineer. BMWE General Chairman will
          be given a list of the officers so designated.

                                    - 70 -
<PAGE>

                                 RULE 16
                    EXAMINATION, TRAINING, QUALIFYING
                    ---------------------------------

16.1 All employees who are required by law or the Carrier to attend
     classes for operating rules, safety rules, medication and/or
     eye tests (including drug and/or alcohol tests), including
     time spent qualifying on physical characteristics or other
     specific training shall be paid for as time worked for the
     actual time involved at the training rate. Employees will be
     paid the mileage rate if required to travel more than thirty
     (30) miles for such examinations, training, or qualifying.
     When required to remain overnight, actual expenses will be
     paid.

16.2 An employee who is required to travel outside of regular hours
     of work to school will be paid four (4) hours at the straight
     time rate for each day of travel.

16.3 The Carrier will pay up to twenty-five dollars ($25.00) twice
     per year, or fifty dollars ($50.00) once per year per employee
     for safety shoes, will provide one (1) pair of safety glasses
     per employee, and will provide hardhats at no charge to the
     employee.

                                    - 71 -
<PAGE>

                                  RULE 17
                         SYSTEM PRODUCTION GANGS
                         -----------------------

17.1 A)   The Carrier may establish System Production Gangs with no
          assigned basic headquarters to work throughout the
          System, wherever their use may be required. Tie Gangs,
          Surface Gangs, Rail Gangs, Bridge Gangs and other gangs
          agreed upon by the parties will be considered as
          Production Gangs.

     B)   Such System Production Gangs shall be assigned to start
          their assignment at a safe, accessible reporting point.
          If said point creates a major problem, the General
          Chairman may handle such matter immediately with the
          Chief Engineer, who will respond thereon in writing
          within ten (10) days providing the basis for final
          resolution.

17.2 When such System Production Gangs are to be established, the
     Carrier will give written notice thereof to the General
     Chairman indicating at least the following:
        A)   Type of productional unit.
        B)   Estimated territory over which programmed to work.
        C)   Estimated length of time Production Gang will operate.
        D)   Number of positions by class to be assigned.
        E)   Number of days per week unit will work.

17.3 A)   Positions to be established will include the information
          set forth in Section 17.2 above and will be bulletined in
          accordance with Rule 11.

                                    - 72 -
<PAGE>

     B)   Assignments to these System Production Gang positions
          will be made on the basis of the earliest seniority date
          of an employee in the class required.

     C)   Employees assigned to these System Production Gangs may
          perform the duties of their positions recognized as work
          of their particular classification through the System
          without regard to seniority districts.  However, in
          performing such duties, they will be restricted from
          performing normal, day to day maintenance work if such
          work could be performed more efficiently by employees on
          the separate seniority district or section gangs.

17.4 Four (4) Day/Ten (10) Hour Day Assignments
     A)   The Carrier may establish System Production Gangs with
          assignments of four (4) days/ten (10) hour days or five
          (5) days/eight (8) hour days.  In the event the work week
          is changed to a five (5) day basis or vice versa for any
          gang the General Chairman shall be given at least five
          (5) days written notice thereof by the Chief Engineer
          Maintenance of Way except that such changes may be made
          in less than five (5) days upon concurrence of the
          General Chairman.

     B)   Employees working in System Production Gangs having a
          four (4) day work week will have the actual time worked
          for each of the four (4) work days posted on the time
          cards.  Employees assigned to a four (4) day work week
          will receive a credit of 1.25 days for each day of
          compensated service towards vacation accrual.

                                    - 73 -
<PAGE>

     C)   On agreed upon holidays System Production Gangs shall
          receive one (1) day's pay at the appropriate rate of the
          assignment for the holiday.  By agreement between the
          General Chairman and the Chief Engineer the day
          designated as the holiday may be changed from the
          assigned agreed upon day to the last day or the first day
          of the work week.

     D)   The days designated as relief days may be Friday,
          Saturday and Sunday or Saturday, Sunday and Monday, or,
          if service dictates, there will be two (2) consecutive
          rest days given within a seven (7) day period from the
          initial assignment, and may not be changed without an
          agreement once the entered assignment is advertised on a
          specific Production Gang.  However, such agreement will
          not be unreasonably withheld.

17.5 Changes made in accordance with Rule 17.4 (D), hereof will not
     require rebulletining of the positions. Neither will they be
     the basis to permit employees assigned to positions in these
     System Gangs to exercise displacement rights.  They may,
     however, bid off the assignment or gang in accordance with the
     provisions of Rules 11 and 14.  Also, when a position is
     abolished or they are displaced by a senior employee, they may
     then exercise seniority in accordance with the provisions of
     Rules 11 and 14.

17.6 A)   The Carrier will furnish camp cars or other lodging for
          each System unit.  Such lodging shall be facilities
          maintained in a clean, healthful, and sanitary condition
          and will be furnished with individual lockers, washing,
          shower and toilet facilities located within the place of

                                    - 74 -
<PAGE>

          lodging, and shall have sufficient ventilation and air
          space (which will include adequate fans or air
          conditioners).

          Dining and sleeping cars will be screened at the
          beginning of each season or as necessary. Kitchen and
          dining cars will be equipped with the necessary cooking
          facilities, dishes, tableware, and utensils. Sleeping
          quarters shall be equipped with a sufficient number of
          bunks to accommodate all those in the cars. Bunks shall
          be equipped with adequate mattresses, blankets, clean
          sheets, pillows, and pillow slips, and an adequate supply
          of water and fuel for domestic purposes shall be
          furnished. Safeguards will be established for the safety
          and health of the employees.

          The above-listed facilities and camp cars will be
          inspected every year by the proper Carrier officer and a
          union representative and a joint report will be made to
          the Chief Engineer, Maintenance of Way, as to their
          findings, and any improper conditions will be corrected.
          However, should a complaint be filed in the interim of
          the one (1) year period, a joint inspection will be made
          immediately or as soon as is possible, and any improper
          conditions will be corrected immediately.

     B)   The Carrier and the General Chairman may enter into a per
          diem agreement in lieu of meals and/or lodging allowances
          as provided in this Agreement.

17.7 The estimated length of time for a System Production Gang as
     referred to in Rule 17.2 C hereof is not a guarantee.  These
     gangs may be terminated earlier than the estimated length of

                                    - 75 -
<PAGE>

     time by abolishment of all positions therein by proper notice
     to the individual employee, or in an emergency. If it is
     intended to continue the gang in operation beyond the
     estimated length of time as specified in Rule 17.2 C, written
     notice shall be given to the General Chairman as promptly as
     possible setting forth an estimate of the additional length of
     time the gang will operate.

17.8 The estimated territory over which a System Production Gang is
     programmed to work as referred to in Rule 17.2 (B), hereof
     does not limit the operation of such production gang to that
     territory exclusively.  They may be used to perform service
     throughout the entire System.

17.9 It is agreed that the provisions of Rule 13, which requires an
     employee to protect his seniority rights in his home seniority
     district will not apply to any employee while he is working is
     a System Production Gang.

                                    - 76 -
<PAGE>

                                 RULE 18
                         AWAY FROM HOME EXPENSES
                         -----------------------

18.1 An employee taken off his assigned territory to work elsewhere
     will be furnished lodging and per diem, or meals at the
     Carrier s option, by the Carrier.  If lodging is not furnished
     by the Carrier, the employee will be compensated for actual
     lodging expenses he may incur.  This Section applies only to
     employees held away from assigned territory an unreasonable
     time beyond the evening meal hour.
                                    
18.2 Employees assigned to positions on System Production Gangs
     will be allowed expenses as follows:

     A)   If the assembly point is more than 50 miles from the
          employee s home, then the Carrier will provide lodging
          and per diem and actual mileage for travel to the
          assembly point on the first day and from the assembly
          point on the last day unless the Carrier provides such
          transportation.

     B)   If the assembly point is 50 miles or less from the
          employee s home, then a reporting payment of $10 per day
          through 12/31/96, $11.50 as of 1/1/97 and $13.00 as of
          1/1/99.
                                    
18.3 When lodging is provided, other than at the Butler facility or
     in camp cars, it shall mean not more than two (2) employees
     per room.

18.4 Personal expenses will be paid within fifteen (15) days of the
     date submitted.

                                    - 77 -
<PAGE>

18.5 Per Diem shall be paid at the following rates: $14.50 starting
     10-16-95 through 12-31-95; $15.00 as of 1-1-96; $15.75 as of
     1-1-97; $16.50 as of 1-1-98; $17.50 as of 1-1-99.

18.6 Carrier shall only until such time as the terms of this
     Agreement are modified pursuant to Rules 37.1 and 37.2,
     continue to provide those employees now receiving it, lodging
     at the Butler facility, per diem and mileage as has been past
     practice.  Such employees  are indicated by an asterisk on the
     roster.

                                    - 78 -
<PAGE>

                                 RULE 19
                               DISCIPLINE
                               ----------

19.1 No employee will be disciplined without a fair hearing. The
     notice of hearing will be mailed to the employee within ten
     (10) days if held out of service or within twenty (20) days of
     the Carrier's first knowledge of the act or occurrence. The
     notice of hearing will contain information sufficient to
     apprise the employee of the act or occurrence to be
     investigated, including the rule(s) alleged to have been
     violated. Such information will include date, time, location,
     assignment, and occupation of employee at the time of the
     incident. The notice of hearing will also include a list of
     witnesses to be called. The hearing will be scheduled to take
     place within twenty (20) days if held out of service or within
     thirty (30) days of the Carrier's first knowledge of the act
     or occurrence. The hearing may be postponed by either party
     due to sickness, injury, or vacation of principals or
     witnesses. The hearing may be postponed for other reasons by
     mutual agreement of the parties. The hearing may be adjourned
     to secure necessary witnesses or if it cannot be completed in
     a day.

19.2 An employee may not be suspended pending a hearing except when
     the act or occurrence to be investigated is of a serious
     nature such as Rule G,  Insubordination, Gross Negligence,
     Dishonesty, or when continuing an employee in service may
     constitute a threat to Carrier personnel, carrier property, or
     property entrusted to the custody of the Carrier.  Suspension
     pending a hearing will not be considered as prejudicial to the
     employee.

19.3 The employee will have the opportunity to request that the
     Carrier provide necessary witnesses not listed on the notice
     of hearing and will have the opportunity to secure the

                                    - 79 -
<PAGE>

     presence of witnesses in his own behalf.  The employee will
     have the right to representation and he and his representative
     will have the right to question all witnesses.  The employee
     and his representative will be provided with a copy of the
     hearing transcript.

19.4 The employee must be notified within fifteen (15) days of the
     completion of the hearing if discipline will be assessed.  The
     types of discipline which may be assessed are reprimand,
     disqualification, deferred suspension, relevant training,
     actual suspension, and dismissal.  The types of discipline may
     be assessed individually or in combination.  

19.5 If the finding of the hearing is that the employee is not at
     fault, he will be compensated for the actual wages lost, if
     any.  If no wages are lost, employee will be paid in
     accordance with the Agreement.

19.6 If the finding of the hearing is that the employee is at
     fault, appeal of discipline assessed must be made within
     thirty (30) days of the date of the discipline notice. Such
     appeal must be made in writing by the BMWE General Chairman to
     the Carrier's highest designated appeals officer.

     Conference must be scheduled within ten (10) days of receipt
     of appeal.  Written response to the appeal will be issued
     within fifteen (15) days from the date of the conference. If
     the decision of the Carrier on appeal is in favor of the
     employee, he will be paid in accordance with Rule 19.5.  If
     the appeal is denied, that decision will be final and binding
     unless within six (6) months of such denial the case is
     disposed of on the property or proceedings for disposition of

                                    - 80 -
<PAGE>

     the case are instituted by the BMWE to a tribunal having
     jurisdiction by law or agreement.

19.7 If the Carrier's discipline decision is modified or overturned
     at any stage of handling resulting in a payment to the
     employee, such payment may be offset by any compensation
     received by the employee during the relevant time period.

19.8 A hearing can be disposed of informally by agreement between
     the parties.

                                    - 81 -
<PAGE>

                                 RULE 20
                                HOLIDAYS
                                --------

20.1 Subject to the qualifying requirements specified below,
     eligible employees will receive eight (8) hours pay at the
     straight time hourly rate for each of the following holidays:

          New Year's Day           Good Friday    
          Memorial Day             Fourth of July 
          Labor Day                Thanksgiving Day         
          Day after Thanksgiving   Christmas Eve (the day before
                                     Christmas is observed)
          Christmas Day            New Year's Eve (the day before
                                     New Year's is observed)

          Such other days as may be allowed to other Carrier
          employees.

20.2 To be eligible for holiday pay provided in Rule 20.1,
     regularly assigned employees must either work or be available
     for work on the last work day before and the first work day
     after the holiday.  If required to work the holiday, employees
     must protect their assignment in order to be eligible for
     holiday pay.

20.3 Subject to the applicable qualifying requirements above, other
     than regularly assigned employees will be eligible for the
     paid holidays or pay in lieu thereof, provided (1)
     compensation for service paid them by the Company is credited
     to eleven (11) or more of the thirty (30) days immediately
     preceding the holiday and (2) they have had a seniority date
     for at least sixty (60) days or have sixty (60) days of
     continuous active service preceding the holiday beginning with

                                    - 82 -
<PAGE>

     the first day of compensated service, provided employment was
     not terminated prior to the holiday by resignation, for cause,
     retirement, death, non-compliance with the union shop
     agreement, or disapproval of application for employment.

20.4 A holiday which falls during an employee's vacation period
     will be allowed to be used to extend that vacation period, or
     to be used at a later date. Subject to the eligibility
     requirements of this Rule, the holiday pay specified in Rule
     20.1 will be paid in addition to the vacation allowance.

20.5 When employees are working a four (4) day, ten (10) hours per
     day work week and a holiday falls on a work day in that work
     week, the holiday pay provided in Rule 20.1 will be modified
     to ten (10) hours at the straight time hourly rate and be paid
     to all eligible employees.

                                    - 83 -
<PAGE>

                                RULE 21
                            SICK LEAVE DAYS
                            ---------------

21.1 Employees off sick will be granted sick leave each calendar
     year as follows:

     Length of Service as of January 1                      Sick leave Days
     Five (5) Years. . . . . . . . . . . . . . . . . . . . . . . . . . . .1
     Ten (10) Years. . . . . . . . . . . . . . . . . . . . . . . . . . . .2
     Fifteen (15) Years. . . . . . . . . . . . . . . . . . . . . . . . . .3

21.2 Sick leave days provided above which remain unused at the end
     of each calendar year will not be accumulated.

21.3 Payment for sick leave days will be eight (8) hours (ten (10)
     hours if the employee is assigned to a position working four
     (4) ten (10) hour days)  at seventy-five percent (75%) of the
     straight time hourly rate.  Sick leave payments will not be
     offset by any RRUI sickness benefits the employee may receive. 
     No sick leave benefits will be paid on any day the employee
     qualifies for compensation under any other Rule of this
     Agreement or the Supplemental Sickness Benefit Plan.

21.4 The Carrier may require satisfactory evidence in the form of
     a letter or certificate from a physician confirming the
     employee's sickness.

                                    - 84 -
<PAGE>

                                 RULE 22
                           HEALTH AND WELFARE
                           ------------------

22.1 The Carrier and the BMWE have agreed that the employees will
     be provided the same Group Insurance Plan, including dental
     coverage, provided by the Delaware Otsego Corporation for its
     employees and extended to the employees of The New York,
     Susquehanna and Western Railway Corporation, and will be
     covered by any changes to such plan.

22.2 Notwithstanding the above, it is agreed that employees will
     not request, or be provided, dependent coverage if that
     employee has coverage for his dependents available elsewhere
     at no charge.

22.3 Carrier shall provide, at its expense, the Supplemental
     Sickness Benefits Agreement currently available from Trustmark
     Insurance Company.

22.4 Subrogation: The Carrier shall be subrogated to any right of
     recovery an employee may have against any party for loss to
     the extent that the Carrier or its group health insurance has
     made payments pursuant to this Rule, and all such payments
     shall operate as an offset against any right of recovery the
     employee may have against the Carrier for hospital, surgical,
     medical, related expenses or damages of any kind.

                                    - 85 -
<PAGE>

                                 RULE 23
                                VACATION
                                --------

23.1 Each employee who has been employed by the Carrier for one (1)
     year or more and who worked for a minimum of 100 working days
     during the previous calendar year, shall be entitled to one
     (1) week's vacation allowance; each employee who has been so
     employed for two (2) years shall be entitled to two (2) weeks
     vacation allowance; each employee who has been so employed for
     nine (9) years shall receive three (3) weeks vacation
     allowance; each employee who has been so employed for fifteen
     (15) years shall receive four (4) weeks vacation allowance;
     each employee who has been so employed for twenty (20) years
     or more shall receive five (5) weeks vacation allowance. All
     such vacations shall be taken as hereinafter provided. It is
     understood and agreed that employees will establish vacation
     qualifications based on the date of hire on the seniority
     roster or date of hire by the Carrier, whichever is earlier.

23.2 Vacations should normally be taken in units of one (1) or more
     weeks but where service requirements permit, an individual
     employee may be permitted by the supervising officer to take
     a vacation period of less than one (1) week. A full work day
     is the minimum vacation period to be taken.

23.3 Employee's weekly vacation allowance will be forty (40) times
     the straight time hourly rate of pay of the last service
     performed prior to taking vacation.


                                    - 86 -
<PAGE>

23.4 Seniority in employee selection will be the basis for the
     establishment of vacation schedules.  Vacation schedules will
     be established each year as follows:

     A)   On or before February 1, the Northern Division and
          Southern Division written blank vacation schedules will
          be provided by the Carrier to the employees.

     B)   On or before February 7, the three (3) most senior MOW
          employees on each roster will chose their vacation time
          for the ensuing year.

     C)   On or before February 14, the next three (3) most senior
          MOW employees on each roster will chose their vacation
          time for the ensuing year.

     D)   The procedure described in subsections (B) and (C) shall
          continue in periods of seven (7) days and three (3) MOW
          employees until the bottom of the roster is reached.

     E)   Any MOW employee who fails to designate his vacation
          during the seven (7) days provided in the procedure
          described above will be allowed to designate his vacation
          after the bottom of the roster is reached, in seniority
          order with any other MOW employee who failed to designate
          his vacation in the procedure described above.

23.5 Vacations will be taken between January 1st and December 31st. 
     However, it is recognized that the requirements of the service
     may create practical difficulties in providing vacations in
     all instances.  Due regard, consistent with requirements of
     the service, shall be given to the preference of the employee
     in his seniority order when granting vacations.

                                    - 87 -
<PAGE>

     Representatives of the Carrier and of the employees will
     cooperate in arranging vacation periods, administering
     vacations and releasing employees when requirements of the
     service will permit.

23.6 Vacations shall not be accumulated or carried over from one
     year to another.  In cases where vacations have not been taken
     due to sickness, suspension or carrier request, vacation time
     will be rescheduled or paid for within that calendar year.

23.7 In the event that an employee takes all or part of the earned
     vacation, prior to reaching the anniversary date in the
     anniversary year, the amount of vacation allowance will be the
     same as if the anniversary date has been reached.

23.8 The vacation provided for in this Rule shall be considered to
     have been earned when the employee has qualified under Section
     23.1 hereof. If an employee's employment status is terminated
     for any reason except voluntary resignation without two (2)
     weeks notice, the full vacation pay earned, up to the time of
     leaving the service, shall be granted upon request. If an
     employee entitled to vacation or vacation pay shall die, the
     vacation pay earned and not received shall be paid according
     to law.

23.9 Employees who take vacation in a weekly block shall be
     considered to be on vacation (Monday-Friday) but will be
     permitted to mark up for work on Saturday and Sunday if they
     so desire by giving their supervisor at least seven (7) days
     advance notice.


                                    - 88 -
<PAGE>

23.10     The parties hereto having in mind conditions which may
          exist or may arise in making provisions for vacation with
          pay, agree that additional understandings may be entered
          into to implement the purpose of this Agreement, provided
          that such understandings shall not be inconsistent with
          this Rule.

                                    - 89 -
<PAGE>
                            RULE 24
                    RETENTION OF SENIORITY
                    ----------------------

24.1 Employees who are presently or subsequently appointed to
     positions not subject to the application or exercise of
     seniority under this Agreement shall retain all their
     seniority rights and shall continue to accumulate seniority
     provided they pay a fee no greater than the current dues
     and assessments being paid by the Carrier's employees
     covered by this Agreement from the effective date of this
     Agreement and shall have all rights and privileges granted
     by the Constitution and By-Laws of the BMWE.

24.2 In the event an employee fails to comply with Rule 24.1
     above, the duly accredited representative shall so notify
     the Chief Engineer and the employee.  Within thirty (30)
     days after receipt of a subsequent notification from the
     Chief Engineer the employee will forfeit his seniority
     unless the employee involved remits all monies due the
     union.

24.3 Employees appointed to positions covered by Rule 24.1 who
     are subsequently removed from such positions by the Carrier
     (other than through dismissal for cause) may displace any
     employee with less seniority or may bid on a bulletined
     vacancy. However, employees suspended from service for
     sixty (60) days or less while in their appointed positions
     may not displace any employee under this Agreement nor bid
     a bulletined vacancy. Employees suspended for more than
     sixty (60) days (other than dismissal for cause) may bid on
     any bulletined vacancy to be effective after sixty (60)
     days but may not displace any regular assigned employee.

                                    - 90 -
<PAGE>

24.4 Employees appointed to positions covered by Rule 24.1 who
     voluntarily demote themselves may bid on any advertised
     position thereafter, but may not displace any regular
     assigned employee.

24.5 The Carrier shall provide the Organization with the names
     and addresses of all employees who appear on any roster
     covered by the scope of this Agreement and who are covered
     by Rule 24.1 within thirty (30) days of the execution of
     this Agreement or, in the case of employees not presently
     holding such positions with the Carrier, within thirty (30)
     days of appointment to such a position.

                                    - 91 -
<PAGE>

                            RULE 25
                       LEAVES OF ABSENCE
                       -----------------

25.1 Employees with one (1) year or more of continuous service
     may request leaves of absence.  Requests for leaves of
     absence must contain specific reasons for the request
     including need for leave and length of time required,
     subject to the limitations of Rule 25.3 below.

25.2 Requests for leaves of absence or extensions thereof must
     be in writing to the Chief Engineer with a copy to the
     General Chairman.

25.3 Except as specified below, leaves of absence or extensions
     thereof will be limited to a minimum of fourteen (14) days
     and a maximum of six (6) months.  Employees who engage in
     other work while on leaves of absence will forfeit
     seniority, unless specials arrangements have been made
     therefor with the Chief Engineer and the General Chairman.

25.4 Requests for leaves of absence or extensions thereof will
     only be considered when the needs of the service allow. If
     a request for a leave of absence or extension thereof is
     denied, such denial will be in writing with a copy to the
     General Chairman.

25.5 Employees appointed to official positions with the Carrier
     or who accept a full-time Union position will be granted
     leaves of absence for the duration of the assignment. This
     individual will be credited for time on leave of absence as
     continuous service for the length of his vacation
     entitlement.

                                    - 92 -
<PAGE>

25.6 Employees returning from leaves of absence as specified in
     Rule 25.3 must report for duty upon the expiration of leave
     or extension thereof.  Failure to return to duty or to
     provide satisfactory reasons for not doing so will result
     in forfeiture of seniority.  Employees may return to
     service prior to the expiration of leave or extension
     thereof  provided they furnish seven (7) calendar days
     advance notice.

25.7 Employees returning from leaves of absence as specified in
     Rule 25.5 must report for duty within thirty (30) days from
     the conclusion of their assignments and the expiration of
     leave or be subject to the provisions of Rule 25.6.

25.8 Employees returning to service under Rules 25.6 and 25.7
     above will do so pursuant to the provisions of Rule 14
     (Displacements) of this Agreement.

25.9 Employees who absent themselves for more than fourteen (14)
     days without written authorized leaves of absence as
     provided in this Rule will forfeit their seniority.

25.10     Leaves of Absence are not required when employees are
          unable to perform service due to a bona fide sickness
          or injury.

                                    - 93 -
<PAGE>

                            RULE 26
                       BEREAVEMENT DAYS
                       ----------------

26.1 Employees will be allowed bereavement leave not to exceed
     three (3) working days in relation to the death of a
     spouse, child, stepchild, parent, stepparent,
     parent-in-law, stepparent-in-law, sibling, grandparent or
     grandchild.

26.2 Employees will be paid eight (8) hours (ten (10) hours in
     the case of employees assigned to work four (4) ten (10)
     hour days) at the straight time rate for each working day
     lost during bereavement leave with a maximum of three (3)
     days.

26.3 Bereavement pay will not be allowed to employees who are
     otherwise absent from work and will not duplicate payments
     made for holidays or vacation.

                                    - 94 -
<PAGE>

                            RULE 27
           ATTENDING COURT, INQUESTS, INVESTIGATIONS
           -----------------------------------------

27.1 Employees required to attend court, inquests,
     investigations, etc., by or on behalf of the Carrier will
     be paid for actual time consumed at the straight time
     hourly rate and shall be allowed actual expenses incurred,
     with the understanding that employees will furnish written
     receipt for such expenses before being reimbursed. If
     prevented from working their assignments, employees will be
     paid for time lost. It is understood that the provisions of
     this Rule do not apply in the case of employees attending
     hearings where they are subject to discipline.

                                    - 95 -
<PAGE>

                            RULE 28
                           JURY DUTY
                           ---------

28.1 When employees are summoned for jury duty and are required
     to lose time from their assignments as a result thereof,
     they shall be paid for actual time lost with a maximum of
     eight (8) hours at the straight time hourly rate for each
     calendar day lost (or ten (10) hours in the case of
     employees assigned to work four (4) ten (10) hour days, but
     not to exceed forty (40) hours in any work week) less the
     amount allowed by the Court (not to include allowances paid
     for meals, lodging, or transportation). No jury duty pay
     will be allowed for any day on which employees are
     otherwise entitled to vacation or holiday pay.

                                    - 96 -
<PAGE>

                            RULE 29
             PHYSICAL CONDITION - BOARD OF DOCTORS
             -------------------------------------

When an employee covered by this Agreement has been removed from
or is withheld from service on account of his physical condition
and the Organization desires the question of his physical
fitness to be finally decided before he is permanently removed
from his position or restricted from resuming service, the case
shall be handled in the following manner:

     A)   The General Chairman will bring the matter to the
          attention of the Chief Engineer. He and the General
          Chairman shall then each select a doctor to represent
          them, each notifying the other of the name and address
          of the doctors selected. The two (2) doctors thus
          selected shall confer and if they disagree on the
          nature of illness, they shall appoint a third doctor.

     B)   Such board of doctors shall then fix a time and place
          for the employee to meet them. After completion of the
          examination they shall make a report in triplicate:
          one (1) copy to be sent to the Medical Director, one
          (1) copy to the Chief Engineer of the New York,
          Susquehanna and Western Railway, and one (1) copy to
          the General Chairman.

     C)   The decision of the board of doctors on the physical
          fitness of the employee to continue in his regular
          occupation or to resume service shall be final, but
          this does not mean that a change in physical condition
          shall preclude a re-examination at a later time.

                                    - 97 -
<PAGE>

     D)   The doctors selected for such board shall be qualified
          in the disease from which the employee is alleged to
          be suffering, and they shall be located at a
          convenient point so that it will be only necessary for
          the employee to travel a minimum distance, and if
          possible, not be away from home for a longer period
          than one (1) day.

     E)   The Carrier and the Organization shall each defray the
          expenses of its respective appointee. At the time
          their report is made, a bill for the fee, and
          traveling expenses if there are any, of the third
          appointee should be made in duplicate and one (1) copy
          sent to the Medical Director and one (1) copy sent to
          the General Chairman.  The Carrier and the
          Organization shall each pay one-half of the fee and
          traveling expenses of the third appointee.

                                    - 98 -
<PAGE>

                            RULE 30
              USE OF PERSONAL AUTO WHILE ON DUTY
              ----------------------------------

30.1 Employees who use their personal autos while on duty and
     under pay will be allowed twenty-two cents ($.22) per mile
     for such use or such higher rate as may be paid to other
     carrier employees.

                                    - 99 -
<PAGE>

                            RULE 31
                  APPLICATION FOR EMPLOYMENT
                  --------------------------

31.1 Applications for employment will be rejected within sixty
     (60) calendar days after seniority date is established, or
     applicant shall be considered accepted.  Applications
     rejected by the Carrier must be declined in writing to the
     applicant.

                                   - 100 -
<PAGE>

                            RULE 32
                DULY ACCREDITED REPRESENTATIVE
                ------------------------------

32.1 The term "duly accredited representative", as used in this
     Agreement, shall be understood to mean the representative
     or System Officer of the Organization signatory hereto.

32.2 The Organization will notify the Chief Engineer in January
     of each year of who the duly accredited representatives
     are.

                                  - 101 -
<PAGE>

                            RULE 33
                     UNION SHOP AGREEMENT
                     --------------------

                          Union Shop
33.1 In accordance with and subject to the terms and conditions
     hereinafter set forth, all employees of the Carrier now or
     hereafter subject to the Rules and Working Conditions
     Agreement between the parties hereto shall, as a condition
     of their continued employment subject to such Agreement,
     become members of the union party to this Agreement
     representing their crafts or classes within sixty (60)
     calendar days of the date they first perform compensated
     service as such employees after the effective date of this
     Agreement, and thereafter shall maintain membership in good
     standing in such union; except that such membership shall
     not be required of any individual until he has performed
     thirty (30) days of such compensated service within a
     period of twelve (12) consecutive calendar months. Nothing
     in this agreement shall alter, enlarge or otherwise change
     the coverage of the present or future Rules and Working
     Conditions Agreement.  Any employee whose employment is
     terminated prior to the time such employee is required to
     become a member of BMWE shall have no time or money claim
     by reason thereof.

33.2 A)   Employees who have secured seniority under the Rules
          and Working Conditions Agreement and who are
          subsequently regularly assigned or transferred to
          full-time employment not covered by such Agreement or
          are furloughed on account of force reduction will not
          be required to maintain membership as provided in Rule
          33.1 of this agreement so long as they remain in such
          other employment or furloughed as herein provided, but

                                   - 102 -
<PAGE>

          they may do so at their option.  Should such employees
          return to any service covered by the said Rules and
          Working Conditions Agreement they shall, as a
          condition of their continued employment subject to
          such Agreement, be required to become and remain
          members in good standing in the union within thirty
          (30) days from date of their return to such service.

     B)   The seniority status and rights of employees granted
          leave of absence to serve in the Armed Forces shall
          not be terminated by reason of any of the provisions
          of this agreement but such employees shall, upon
          resumption of employment, be governed by Rule 33.1 of
          this Agreement.

33.3 Nothing is this agreement shall require an employee to
     become or to remain a member of the union if such
     membership is not available to such employee upon the same
     terms and conditions as are generally applicable to any
     other members, or if the membership of such employee is
     denied or terminated for any reason other than the failure
     of the employee to tender the periodic dues, initiation
     fees, and assessments (not including fines and penalties)
     uniformly required as a condition of acquiring or retaining
     membership. For purposes of this Rule, dues, fees, and
     assessments shall be deemed to be "uniformly required" if
     they are required of all employees in the same status at
     the same time in the union.

33.4 A)   The Carrier will furnish to the union information with
          respect to the employment status of employees
          represented by it, and which information is pertinent

                                   - 103 -
<PAGE>

          to the administration of this agreement.  The union
          will notify the Carrier in writing of any employee who
          by reason of failure to comply with the terms of this
          agreement is not entitled to continue in employment. 
          Upon receipt of such notice, the Carrier will, as
          promptly as possible but within ten (10) calendar days
          of such receipt, so notify the employee concerned in
          writing by certified mail, return receipt requested,
          or by personal delivery evidenced by receipt.  Copy of
          such notice shall be given the union.  Any employee so
          notified who disputes the fact that he has failed to
          comply with the terms of this agreement, shall, within
          a period of ten (10) calendar days from the date of
          such notice, request the Carrier in writing to accord
          him a hearing which shall be held as soon as possible
          and within ten (10) calendar days of receipt of
          request therefor. Notice of the date set for hearing
          shall be promptly given the employee in writing by
          certified mail, return receipt requested, or by
          personal delivery evidenced by receipt. Copy of notice
          of such hearing shall be given to the union and the
          union shall attend and participate in the hearing. The
          receipt by the Carrier of a request for a hearing
          shall operate to stay action on the termination of
          employment until the hearing is held and the decision
          of the Carrier is rendered. In the event the employee
          concerned fails to request a hearing as provided
          herein, the Carrier shall proceed to terminate his
          employment and seniority not later than thirty (30)
          calendar days from receipt of the above described
          notice from the union, unless the Carrier and the
          union agree otherwise in writing.

     B)   The Carrier shall determine on the basis of the

                                   - 104 -
<PAGE>

          evidence produced at the hearing whether or not the
          employee has complied with the terms of this
          agreement, and shall render a decision accordingly. 
          Such decision shall be rendered within ten (10)
          calendar days of the hearing date and the employee and
          the union shall be promptly advised thereof.  If the
          decision is that the employee has not complied with
          the terms of this agreement, his employment and
          seniority shall be terminated within ten (10) calendar
          days of the date of said decision, unless the Carrier
          and the union agree otherwise in writing.  If the
          decision of the Carrier is not satisfactory to the
          employee or to the union, it may be appealed directly
          to the highest officer of the Carrier designated to
          handle such appeals. Such appeals shall be taken
          within ten (10) calendar days of the date of the
          decision appealed from, and if taken, shall operate to
          stay action on the termination of employment, until
          the decision on appeal is rendered.  The Carrier shall
          promptly notify the other party in writing of any such
          appeal.  The decision on such appeal shall be rendered
          within ten (10) calendar days of the date the appeal
          is taken, and the employee and the union shall be
          promptly advised thereof. If the decision on such
          appeal is that the employee has not complied with the
          terms of this agreement, his employment and seniority
          shall be terminated within ten (10) calendar days of
          the date of said decision unless the Carrier and the
          union otherwise agree in writing.  Such decision on
          appeal shall be final and binding unless within ten
          (10) calendar days thereof the union or the employee
          involved requests the selection of a neutral person to
          decide the dispute as provided in Rule 33.4(C) below.
          Any request for selection of a neutral person as
          provided in Rule 33.4(C) below, shall operate to stay

                                   - 105 -
<PAGE>

          action on the termination of seniority and employment
          until not more than ten (10) calendar days from the
          date decision is rendered by the neutral person.

     C)   If within ten (10) calendar days after the date of a
          decision on appeal by the highest officer of the
          Carrier designated to handle appeals under this
          agreement, the union or the employee involved requests
          such highest officer in writing that a neutral person
          be appointed to decide the dispute, a neutral person
          to act as sole arbitrator to decide the dispute shall
          be selected by the highest officer of the Carrier
          designated to handle appeals under this agreement or
          his designated representative, the Chief Executive of
          the union or his designated representative, and the
          employee involved or his representative.  If they are
          unable to agree upon the selection of a neutral
          person, any one of them may request the Chairman of
          the National Mediation Board in writing to appoint
          such neutral person.  The Carrier, the union and the
          employee involved shall have the right to appear and
          present evidence at a hearing before such neutral
          person. Any decision by such neutral person shall be
          made within thirty (30) calendar days from the date of
          receipt of the request for his appointment and shall
          be final and binding upon the parties.  The Carrier,
          the employee and the union shall be promptly advised
          thereof in writing. If the position of the employee is
          sustained, such fees, salary and expenses shall be
          borne in equal shares by the Carrier and the union. If
          the position of the employee is not sustained, such
          fees, salary and expenses shall be borne in equal
          shares by the Carrier and the union and the employee.

                                   - 106 -
<PAGE>

     D)   Time limits specified in this Rule may be extended in
          individual cases by written agreement of the Carrier
          and the union.

     E)   The union shall notify the Carrier in writing of the
          title(s) and address(es) of its officers or
          representatives who are authorized to serve and
          receive notices described in this Rule.  The Carrier
          shall notify the union of the title(s) and address(es)
          of its officers or representatives who are authorized
          to receive the notices described in this Rule. 

33.5 The Carrier shall not be required to terminate the
     employment of any employee until such time as the services
     of a qualified replacement are available.  The
     determination of whether a qualified replacement is
     available shall be made jointly by the designated
     representative of the Carrier and the designated
     representative of the union.  The Carrier may not, however,
     retain any employee in service under the provisions of this
     paragraph for a period in excess of ninety (90) calendar
     days from the date of the union's original notice or sixty
     (60) calendar days from the date of the last decision
     rendered in accordance with Rule 33.4(C) above. Employees
     whose service is extended under the provisions of this Rule
     shall not, during such extension, retain or acquire any
     seniority rights.

33.6 An employee whose employment and seniority is terminated
     pursuant to the provisions of this agreement shall have no
     time or money claim by reason thereof.

                                   - 107 -
<PAGE>

33.7 In the event that seniority and employment under the Rules
     and Working Conditions Agreement is terminated by the
     Carrier under the provisions of this agreement, and such
     termination of seniority and employment is subsequently
     determined to be improper, unlawful, or unenforceable, the
     union shall indemnify and save harmless the Carrier against
     any and all liability arising as the result of such
     improper, unlawful, or unenforceable termination of
     seniority and employment; provided, however, that this 
     sentence shall not apply to any case in which the Carrier
     is the plaintiff or the moving party in the action in which
     the aforesaid determination is made or in which case the
     Carrier acts in collusion with any employee; provided
     further, that the aforementioned liability shall not extend
     to the expense to the Carrier in defending suits by
     employees whose seniority and employment are terminated by
     the Carrier under the provisions of this agreement.

                                   - 108 -
<PAGE>

                            RULE 34
                        DUES DEDUCTION
                        --------------

34.1 A)   Subject to the terms and conditions hereinafter set
          forth, the Carrier will deduct from the wages of
          employees, membership dues, fees and assessments
          (excluding fines and penalties) whenever applicable
          each calendar month which are uniformly required as a
          condition of acquiring or retaining membership in the
          union upon written and unrevoked authorization of the
          employee on the form, WAGE DEDUCTION AUTHORIZATION
          agreed upon by the parties hereto, a copy of which is
          attached and made a part of this Agreement.

     B)   The designated representative of the union shall
          promptly notify in writing the officer or officers
          designated by the Carrier of any special assessments
          or changes in amounts of fees or dues, and shall also
          furnish to such designated officer or officers of the
          Carrier, the individual authorization forms as
          provided for herein.

34.2 A)   Individual authorizations to be effective for a
          particular calendar month must be in the possession of
          the Carrier not later than the twentieth (20th) day of
          the month preceding the month in which such deductions
          are to be made.

     B)   The designated representative of the union shall
          furnish to the Carrier an initial statement in
          alphabetical order, showing the employee's name, lodge
          number, Social Security number, and amount to be

                                   - 109 -
<PAGE>

          deducted, such statement to be furnished together with
          individual authorization forms to cover, not later
          than the twentieth (20th) day of the month preceding
          the month in which the deductions become effective.
          Subsequent monthly deductions will be based on the
          initial statement, plus a monthly statement showing
          additions or deletions, furnished in the same manner
          as the initial statement required hereby.

34.3 Said deductions will be made monthly and shall be remitted
     to the Officer designated by the union not later than the
     end of the month in which deductions are made, accompanied
     by a list in alphabetical order showing the name of each
     employee for whom a deduction was made, his lodge number,
     Social Security number, and the amount of the deduction and
     the total amount of money deducted.  If the earnings of the
     employees are insufficient in the pay period in which
     deductions are made to permit the full amount of the
     deduction, no deduction will be made for that month.  In
     the event of any excess or shortage in said deductions for
     an individual employee, said excess or shortage will be
     subject to adjustment by the union and individual employee.

34.4 The following payroll deductions will have priority over
     the deductions covered by this agreement:
               Federal, state and local taxes.
               Other deductions required by law and court orders.
               Amounts due Carrier.

                                   - 110 -
<PAGE>

34.5 The deductions provided for herein shall not be effective
     with respect to any individual employee until the Carrier
     has been furnished with written authorization of assignment
     of wages of such monthly membership dues, initiation fees,
     reinstatement fees, and assessments.  Such assignment shall
     be revocable in writing after the expiration of one (1)
     year, or upon termination of this Agreement.

34.6 Responsibility of the Carrier under this arrangement shall
     be limited to remitting to the union the amount actually
     deducted from wages of employees pursuant hereto and the
     Carrier shall not be responsible financially or otherwise
     for failure to make deductions or for improper or
     inaccurate deductions.  Any question arising as to the
     correctness of the amount deducted shall be handled between
     the employee involved and the union, and any complaints
     against the Carrier in connection therewith shall be
     handled by the union on behalf of the employees concerned.

34.7 The union shall indemnify and save harmless the Carrier
     from and against any and all claims, demands, liability,
     losses or damage resulting from the entering into of this
     agreement or arising or growing out of any dispute or
     litigation from any deductions made by the Carrier pursuant
     to this agreement; except for remitting to the union the
     monies deducted pursuant to this agreement; provided,
     however, that this sentence shall not apply to any case in
     which the Carrier is the plaintiff or the moving party in
     the action or in which case the Carrier acts in collusion
     with any employee; provided further, that the
     aforementioned liability shall not extend to the expense to
     the Carrier in defending suits by employees as a result of
     the Carrier's action under this agreement.

                                   - 111 -
<PAGE>

34.8 In the event of a change in representation of employees now
     represented by the union this agreement shall be
     automatically terminated as of the date official
     notification is received from the National Mediation Board
     of such change in representation.

                                   - 112 -
<PAGE>

                 WAGE DEDUCTION AUTHORIZATION
                 ----------------------------
                          Between The

   THE NEW YORK, SUSQUEHANNA AND WESTERN RAILWAY CORPORATION

                             And The
                       
          BROTHERHOOD OF MAINTENANCE OF WAY EMPLOYES

                          
                                                               
                                   ------------------------------
                                   Employee Identification Number





-----------------------------------------------------------------
PRINT LAST NAME               FIRST NAME          MIDDLE INITIAL





-----------------------------------------------------------------
HOME STREET ADDRESS           CITY           STATE          ZIP


PAYROLL DIRECTOR:

I hereby assign to the Brotherhood of Maintenance of Way
Employes that part of my wages necessary to pay initiation fees,
periodic dues and assessments (not including fines and
penalties) as certified to the Carrier by the
Secretary-Treasurer of the Brotherhood of Maintenance of Way
Employes as provided in the dues deduction rule and authorize
the Carrier to deduct such sum from my wages and pay it to the
Organization in accordance with the Dues Deduction Agreement.

Dues, contributions or gifts to the Brotherhood of Maintenance
of Way Employes are not deductible as charitable contributions
for Federal income tax purposes.  Dues paid to the Brotherhood
of Maintenance of Way Employes, however, may qualify as business
expenses and may be deductible in limited circumstances subject
to various restrictions imposed by the Internal Revenue Code.


                                                               
-------------------------- --------------------------------------
DATE                       SIGNATURE




-------------------------- --------------------------------------
LODGE NUMBER               SOCIAL SECURITY NUMBER

                                   - 113 -
<PAGE>

                     WAGE DEDUCTION REVOCATION
    
                              Between The
           
          THE NEW YORK, SUSQUEHANNA AND WESTERN RAILWAY CORPORATION

                                 And The
              
                BROTHERHOOD OF MAINTENANCE OF WAY EMPLOYES




                                               -----------------------
                                               Employee Name




                                               -----------------------
                                               Social Security #
   

                                   
The New York, Susquehanna and Western Railway Corporation
1 Railroad Avenue
Cooperstown, NY 13326

Attn: Payroll Department

Dear Sir/Madam:

Effective in the next calendar month, I hereby revoke the wage
assignment now in effect assigning to the Brotherhood of
Maintenance of Way Employes that part of my wages necessary to
pay initiation fees, periodic dues and assessments (not
including fines and penalties), and I hereby cancel the
authorization.

                                   Sincerely yours,


                                   

                                   ------------------------------
                                   Employee's Signature

                                   


                                   ------------------------------
                                   Employee Identification Number


Date                                
---------------------------------



Signature of Union Representative                              
                                  -------------------------------


Lodge #
---------------------------------

                                   - 114 -
<PAGE>

                            RULE 35
               BMWE POLITICAL LEAGUE DEDUCTIONS
               --------------------------------

35.1 A)   Subject to the terms and conditions hereinafter set
          forth, the Carrier will deduct from the wages of
          employees voluntary political contributions upon their
          written authorization on the form,  CONTRIBUTION
          DEDUCTION AUTHORIZATION, agreed upon by the parties
          hereto, copy of which is attached, designated and made
          a part hereof.

     B)   Voluntary political contributions will be made monthly
          from the  compensation of employees who have executed
          a written authorization providing for such deductions. 
          The first such deduction will be made in the month
          following the month in which the authorization is
          received.  Such authorization will remain in effect
          for a minimum of twelve (12) months and thereafter
          until canceled by thirty (30) days' advance written
          notice from the employee to the BMWE and the Carrier. 
          Changes in the amount to be deducted will be limited
          to one (1) change in each twelve (12) month period,
          and any change will coincide with a date on which dues
          deduction amounts may be changed under the Dues
          Deduction Rule. 

35.2 The General Chairman or his designated representative shall
     furnish the Carrier with a copy to appropriate units of the
     BMWE, an initial statement by lodges, in alphabetical order
     and certified by him, showing the amounts of deductions to
     be made from each employee, such statement to be furnished
     together with individual authorization forms to cover, and

                                  -  115 -
<PAGE>

     payroll deductions of such amounts will commence in the
     month immediately following.  Subsequent monthly deductions
     will be based on the initial statement plus a monthly
     statement showing additions and/or deletions furnished in
     the same manner as the initial statement required
     hereinabove.

35.3 Monthly voluntary political contribution deductions will be
     made from wages at the same time that membership dues are
     deducted from the employee's paycheck.

35.4 Concurrent with making remittance to the Organization of
     monthly membership dues, the Carrier will make separate
     remittance of voluntary political contributions to the
     Treasurer, Maintenance of Way Political League, together
     with a list prepared in accordance with the requirements of
     the Dues Deduction Rule pertaining to the remittance of
     monthly membership dues, with a copy to the General
     Chairman.

35.5 The requirements of this Rule shall not be effective with
     respect to any individual employee until the employer has
     been furnished with a written authorization of assignment
     of wages of such monthly voluntary political contribution.

                                   - 116 -
<PAGE>

              MAINTENANCE OF WAY POLITICAL LEAGUE
              -----------------------------------
             CONTRIBUTION DEDUCTION AUTHORIZATION
                               
                          Between The
                               
   THE NEW YORK, SUSQUEHANNA AND WESTERN RAILWAY CORPORATION
                               
                            And The
                               
          BROTHERHOOD OF MAINTENANCE OF WAY EMPLOYES


PAYROLL MANAGER:

I hereby authorize you to deduct from my wages the sum of $    
_______________for each month in which compensation is due.  This
authorization is voluntarily made, with the understanding that
the monies deducted will be deposited in the account of the
Maintenance of Way Political League and will be used solely for
the purpose of making political contributions in connection with
Federal, State and Local Elections.

I understand that contributions or gifts to the Maintenance of
Way Political League are not deductible as charitable
contributions for Federal income tax purposes.

It is understood that this authorization will remain in effect
for a minimum of twelve (12) months and may thereafter be
revoked by giving the Carrier and the Organization thirty (30)
days advance notice in writing of my desire to do so.




-----------------------------------------------------------------
PRINT LAST NAME               FIRST NAME           MIDDLE INITIAL




-----------------------------------------------------------------
HOME STREET ADDRESS      CITY                STATE          ZIP




---------------------------------- ------------------------------
DATE                               SIGNATURE


---------------------------------- ------------------------------
LODGE NUMBER                       SOCIAL SECURITY NUMBER

                                   - 117 -
<PAGE>

               MAINTENANCE OF WAY POLITICAL LEAGUE
               -----------------------------------
                CONTRIBUTION DEDUCTION REVOCATION

                          Between The
           
     THE NEW YORK, SUSQUEHANNA AND WESTERN RAILWAY CORPORATION

                            And The
             
                BROTHERHOOD OF MAINTENANCE OF WAY EMPLOYES


                              Employee Name
                              ------------------------------------


                              Social Security #
                              ------------------------------------

The New York, Susquehanna and Western Railway Corporation
1 Railroad Avenue
Cooperstown, NY 13326

Attn: Payroll Department

Dear Sir/Madam:

Effective in the next calendar month, I hereby revoke the
contribution deduction authorization now in effect assigning to
the Brotherhood of Maintenance of Way Employes' Political League
that part of my wages contributed to the Maintenance of Way
Political League, and I hereby cancel the authorization.



                                   Sincerely yours,


                                   

                                   -------------------------------
                                   Employee s Signature

                                   


                                   -------------------------------
                                   Employee Identification Number

Date                               
----------------------------------




Signature of Union Representative                              
                                  --------------------------------
                           

Lodge #
----------------------------------

                                   - 118 -
<PAGE>

                               RULE 36
                        EMPLOYEE INFORMATION
                        --------------------

36.1 The Carrier will provide the General Chairman with a list
     of employees who are hired or terminated, their home
     addresses, and if available, the employee's identification
     numbers.  This information will be limited to the employees
     covered by this Agreement and will be furnished to the
     General Chairman within whose jurisdiction the employees
     are hired or terminated.  The data will be supplied within
     thirty (30) days after the end of the month in which the
     employee is hired or terminated.  Where Carrier cannot meet
     the thirty (30) day requirement, the matter will be worked
     out with the General Chairman.

                                   - 119 -
<PAGE>

                            RULE 37
                          MORATORIUM
                          ----------

37.1 This Agreement shall remain in effect until changed or
     modified in accordance with the provisions of the Railway
     Labor Act.

37.2 No party to this Agreement shall serve notice prior to July
     1, 1999, (not to become effective before January 1, 2000.

37.3 This Rule will not bar the Carrier and BMWE from agreeing
     upon any subject of mutual interest.


                               RULE 38
                       PRINTING OF AGREEMENT
                       ---------------------

The Carrier will print and distribute this entire Agreement to
the employees covered by this Agreement, within sixty (60) days
from final ratification.


Signed in Cooperstown, New York this__________day__________ of,19_____.

FOR: BROTHERHOOD OF MAINTENANCE OF WAY EMPLOYES



---------------------------------- -----------------------------------
General Chairman                   Local  Chairman


FOR: THE NEW YORK, SUSQUEHANNA AND WESTERN RAILWAY CORPORATION


---------------------------------- -----------------------------------
President                          Vice President-Engineering

                                   - 120 -