of the aformentioned agreement. Said agreement, to be filed with the Commission for approval when completed and executed, shall include in substance the following terms:

i. CNW will pay one-half of 10 percent of the agreed joint facility valuation monthly, divided by the number of railroads using the trackage.

ii. The initial joint facilities valuation of the subject trackage, including land value, is agreed by the parties to be $12,482,220.

iii. Maintenance and operation expenses will be paid by CNW on a car-mile proportion of costs incurred by BN for maintenance, operations, taxes and

assessments.

b. Following merger of BN and Frisco, the merged company shall grant to CNW an option, exercisable during a 2-year period commencing on the date the merger is consummated, to enter into a 50-year lease pursuant to which CNW would lease from BN approximately 20 acres of land located within its Union Yard complex and which land is more particularly identified on the print attached to the stipulation. CNW shall purchase from BN for $346,821 the track materials, consisting mainly of trackage, turnouts and ties, which occupy said land and shall pay the cost of BN trackage rearrangements necessary to effectuate the lease and permit continued BN service and operations including, but not limited to, service to Union Elevator. All future track material installed by CNW shall remain the property of CNW. Under the lease CNW shall pay to BN, in equal monthly installments, an annual rental equal to 10 percent of the value of the land subject to the lease. The initial value of the land to be leased to CNW is agreed by the parties to be $1.25 per square foot on the effective date of the merger. The value of the land at lease commencement date shall be $1.25 per square foot increased by reference to the performance of the Consumer Price Index during the period between consummation of the merger and the lease commencement date. The land value shall be further escalated during the life of the lease at 5-year intervals by reference to the Consumer Price Index. The parties will incorporate the foregoing substantive terms in an option and lease agreement, satisfactory in form to the parties. which fully describes the property and governing terms and conditions, and which will be filed with the Commission for approval when completed and executed. 3. Kansas City Southern.

The new consolidated company shall afford KCS the opportunity to quote on routing via KCS as an alternate to the other junctions on unit train, trainload, and multiple car movements of coal from BN origins in Montana and Wyoming to points presently served by KCS or which may in the future be served by KCS.

4. Southern.

The present traffic and operating relationships existing between BN and Southern, and between Frisco and Southern, and all other lines connecting with BN and Frisco, shall be continued by the new consolidated company. Such relationships include by way of example, not by way of limitation, cooperation in providing and maintaining present levels of run-through train service at Centralia, IL, pursuant to agreement between BN and Southern dated July 6, 1970, as amended, so long as warranted by traffic volume, and provided that Southern also maintains present levels of train service to and from Centralia. Such relationships also include trackage rights and other operating arrangements between BN and Southern and between Frisco and Southern. Southern consents to the new consolidated company succeeding Frisco as tenant under any such arrangements.

Upon merger of BN and Frisco, the new consolidated company will acquire all rights and obligations now held by Frisco under any such arrangements or agreements. 5. Union Pacific.

a. The present traffic and operating relationships existing between applicants, on the one hand, and all lines connecting with their tracks, on the other, shall be continued. Following consummation of the merger of Frisco into BN, the new consolidated company and UP will continue to provide existing run-through train service via Kansas City, MO, now provided jointly by Frisco and UP, at least to the current level of service, as long as the volume of traffic moving in such run-through trains warrants their operation.

In this regard, the new consolidated company and UP should use their best effort and cooperate with each other in order to maintain and improve the quality of their run-through train service via Kansas City, MO.

b. The new consolidated company shall establish and maintain routes, rates, and transit arrangements on grain and grain products via BN-Butte-Silver Bow, MT-UP between its points in Montana, North Dakota, and Minnesota, on the one hand, and UP points in Utah, Nevada, and California, on the other hand. Transit arrangements will be consistent with BN transit arrangements maintained to other west coast markets or to the same market via other routes. Rates on these newly established routes shall be no higher than those via any other routes in which the new consolidated company participates between the same points. With respect to these new rates via Butte-Silver Bow, the new consolidated company and UP will in good faith negotiate divisions of revenues.

c. Following merger, applicants shall concur in the publication of the following language in all relevant Western Trunk Line, Southwestern Lines, other rate bureau tariffs, and individual line tariffs in which they participate and shall not oppose the taking effect of the following tariff language, the purpose of which is to maintain the existing UP-Frisco traffic interchange at Kansas City, MO/KS:

Except as otherwise provided, rates and charges from or to UP points in Colorado and Wyoming moving via UP through Dale, WY, as authorized in this tariff (or in other tariffs covering routing provisions as authorized), will not apply when interchanged with the BN at Denver, CO, and having prior or subsequent movement via Kansas City, MO/KS on traffic moving from, to or via the former St. Louis-San Francisco Railway.

UP should implement this condition by sending the letter, or variations thereof, that appears as appendix A to its stipulation with BN to the chairman of the Western Trunk Line. The new consolidated company shall adopt all such tariffs and tariff amendments and take all other additional action necessary or appropriate to implement this condition.

d. It is understood by the new consolidated company and UP that traffic will be delivered to or received from UP at Grand Island, NE, consistent with the rate and oute provisions as currently published in the various applicable tariffs listed in ppendix B to the stipulation between UP and BN.

6. Railroad employees of the merged system and subsidiaries shall be entitled to the tandard level of protection, unless an agreement is entered prior to merger, in which ase protection shall be at the negotiated level.

New York Dock Ry-Control-Brooklyn Eastern Dist. 360 LCC 60 (1979).

INDEX DIGEST