THE PENN CENTRAL CORPORATION
       TRANSITION/RETENTION AND SEVERANCE ARRANGEMENTS FOR
            NEIL M. HAHL, V.P. - ACCOUNTING AND TAXES
                           TERM SHEET


I.   Transition/Retention Bonus:

Provided that an Eligible Executive remains continuously employed
by The Penn Central Corporation ("PCC") or a PCC subsidiary
company or a successor to PCC or a PCC subsidiary company until
March 31, 1988, or, if earlier, his involuntary termination of
employment, other than for Cause ("Involuntary Termination"), he
will be paid a lump sum "Transition/Retention Bonus" (less
appropriate payroll deductions) on April 1, 1988 (or upon any
such earlier Involuntary Termination) equal to his "Annual Cash
Compensation" times the applicable multiple specified in Section
V below.  The Retention Bonus shall not be considered an offset
against, or taken into account in determining, any other amount
to which he might otherwise be entitled under PCC's plans and
programs, including his Annual Incentive Compensation ("AIC")
Plan award for 1987.

Annual Cash Compensation is defined for purposes of the
Transition/Retention Bonus as an Eligible Executive's annual base
salary at March 31, 1987 plus his AIC Plan annual target bonus
opportunity as of that date.  The term AIC Plan as used in this
term sheet, includes any successor plan in which the Eligible
Executive participates which provides the Eligible Executive with
annual cash bonus opportunities at least equal to those provided
by the AIC Plan.

II.  Severance Arrangement:

Upon the Involuntary Termination or an Eligible Executive, he
will be paid a lump sum "Severance Payment", less required
payroll deductions, equal to his Annual Cash Compensation times
the applicable multiple specified in Section V below.  The
Severance Payment shall be in addition to any
Transition/Retention Bonus to which an Eligible Executive may be
entitled and, in addition, shall not be considered an offset
against, or taken into account in determining, any other amount
to which an Eligible Executive might otherwise be entitled,
including any earned but unpaid awards under the AIC Plan.

Annual Cash Compensation for purposes of the Severance Payment is
defined as an Eligible Executive's then current annual base
salary plus his then current AIC Plan annual target bonus
opportunity.

The Severance Arrangement will remain in effect as long as the
Eligible Executive is employed by PCC or one of its subsidiaries,
but not after he reaches age 65.

III. Definitions of Involuntary Termination and Cause:

Involuntary Termination for purposes of the Transition/Retention
Bonus and the Severance Arrangement includes voluntary
termination as a result of (1) the Eligible Executive being
required to relocate outside the New York metropolitan area
without his consent, or (2) a reduction in the Eligible
Executive's annual base salary or AIC annual target bonus
opportunity

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immediately prior to such reduction), other than such a reduction
which occurs after March 31, 1988, and is related primarily to
the economic performance or prospects of PCC and is not applied
to such Eligible Executive in a discriminatory manner.

"Cause" as used in this Term Sheet means the willful engaging by
the Eligible Executive in conduct that is materially injurious to
PCC.

IV.  Stock Options, Retirement and Savings, Vacation and Group
Insured Benefit Programs:

Upon an Eligible Executive's Involuntary Termination, he will
become fully vested in his PCC employee stock options and in his
accrued benefit in any savings and retirement plans, including
Benefit Equalization Plans and other supplemental plans or
arrangements, in which he participates, and each of his PCC
employee stock options will become fully exercisable for a period
ending the earlier of (i) two years after the date of such
Involuntary Termination or (ii) ten years after the date of grant
of such options.  Additionally, he will be paid a lump sum amount
equal to his unused vacation pay entitlement, less required
payroll deductions.  Moreover, participation in all of the group
benefit plans provided by PCC, a PCC subsidiary or a successor,
as the case may be, prior to such Involuntary Termination,
including medical, dental, life, disability and other insured
benefits ( or their equivalents) and his ten current special
benefits, including use of a company-provided automobile will be
continued, at no cost to him, for a one year period of until he
obtains comparable benefits with another employer, whichever
occurs first.

Upon termination of his group medical and dental coverage, a
described above, the Eligible Executive will be entitled to such
contributory medical, dental or other insurance coverage as
required by law.  Additionally, he will be eligible within 31
days after termination of his life and/or medical insurance
coverage (including any contributory extended coverage required
by law) to convert such coverages to individuals policies.

V.   Eligible Executives:

                                               Multiple
     Name             Title                    Transition/
                                           Retention Severance
     N. M. Hahl     VP - Acctg & Taxes       1.0       1.0


VI.  Death or Disability:

If an Eligible Executive's employment should terminate prior to
March 31, 1988 due to his death or disability, he (or his legal
representatives) shall be paid a pro-rata portion of his
Transition/Retention Bonus opportunity based on the portion of
the 12 months ending March 31, 1988 that he was continuously
employed by PCC or one of its subsidiaries.



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VII. PCC Obligation:

The Transition/Retention Bonus and Severance Arrangements
described herein will be legal obligations of and binding upon
PCC and its successors and assigns.


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