CLARIFICATION OF
AGREEMENT AND PLAN OF MERGER
Reference is hereby made to the Agreement and
Plan of Merger, dated as of August 3, 1995 (the "Merger
Agreement"), by and among Union Pacific Corporation, a
Utah corporation ("Parent"), Union Pacific Railroad
Company, a Utah corporation and an indirect wholly owned
subsidiary of Parent ("UPRR"), UP Acquisition Corpora-
tion, a Delaware corporation and a direct wholly owned
subsidiary of UPRR ("Sub"), and Southern Pacific Rail
Corporation, a Delaware corporation (the "Company"). On
behalf of the parties to the Merger Agreement, the under-
signed are entering into this letter agreement which sets
forth certain clarifications to the Merger Agreement in
order to correct certain typographical errors, delete
surplus verbiage and clarify certain other matters.
Capitalized terms that are defined in the Merger Agree-
ment and not otherwise defined herein shall have the
respective meanings ascribed to them in the Merger Agree-
ment. The parties agree that the Merger Agreement shall
be conformed to reflect the following clarifications:
1. Section 5.1(d) of the Merger Agreement.
The parties understand and agree that (a) Section 5.1(d)
of the Merger Agreement inadvertently contains a refer-
ence to "(B)" in clause (ii) thereof and that such refer-
ence to "(B)" shall be deemed to be deleted; (b) a semi-
colon was inadvertently omitted immediately before clause
(ii) of Section 5.1(d) and shall be deemed to be insert-
ed; (c) a comma was inadvertently omitted after the
phrase "employee benefit plan" in clause (ii) of Section
5.1(d) and shall be deemed to be inserted therein; and
(d) the period which was inadvertently inserted at the
end of Section 5.1(d) shall be deemed to be deleted and a
semicolon shall be deemed to be inserted in lieu thereof.
2. Section 5.4 of the Merger Agreement. The
parties wish to clarify that the reference in Section 5.4
of the Merger Agreement to the 17.25% of the shares of
capital stock of Spinco for which Parent intends to
effect an initial public offering shall be calculated
after giving effect to the issuance of shares in such
initial public offering and to the shares to be issued to
employees or reserved for issuance with respect to em-
ployee options.
3. Section 5.6(d) of the Merger Agreement.
The parties wish to clarify that the paragraph beginning
"First Payment:" in Section 5.6(d) of the Merger Agree-
ment, which discusses the payment of the MCP Awards,
inadvertently contains two references to "December 25,
1995." Such references to "December 25, 1995" are hereby
deemed to be deleted and "December 15, 1995" shall be
deemed to be inserted in lieu thereof.
4. Section 5.11 of the Merger Agreement. The
parties wish to clarify that Section 5.11 of the Merger
Agreement inadvertently states that Parent shall maintain
directors' and officers' insurance in effect for not less
than six years after consummation of the Offer; such
reference to the "Offer" was intended by the parties to
refer to, and shall hereby be deemed to refer to, the
"Merger."
5. Condition to the Merger. Subject to and in
reliance upon compliance with the provisions of the
proviso of this sentence, the following sentence and
Section 20 of the Clarification of Anschutz Shareholders
Agreement and Anschutz/Spinco Shareholders Agreement
being executed concurrently herewith, the parties agree
that the condition to the Merger set forth in Section
6.2(d) of the Merger Agreement was not intended by the
parties to, and does not, extend to any waiting period
pursuant to the HSR Act applicable to the acquisition by
the Anschutz Holders of Parent Common Stock pursuant to
the Merger; provided, however, that, if all waiting
periods applicable under the HSR Act to the acquisition
by the Anschutz Holders of Parent Common Stock pursuant
to the Merger shall not have expired or been terminated
at the time of the Merger, the Anschutz Holders will take
appropriate action, and Parent and the Company will coop-
erate with Anschutz Holders, to enable the Merger to
close without delay and without violation of the HSR Act,
including, for example, by entering into an appropriate
escrow agreement or other arrangement pending divestiture
or completion of HSR Act review. Each of the parties
hereto agrees to use its best efforts to take, or cause
to be taken, all action and to do, or cause to be done,
all things necessary, proper or advisable, whether under
applicable laws and regulations or otherwise, to cause
all applicable waiting periods under the HSR Act to
expire or terminate with respect to the acquisition by
the Anschutz Holders of Parent Common Stock pursuant to
the Merger; provided, however, that none of the parties
hereto or their subsidiaries shall be required to take
any action that would be materially harmful to their
businesses, assets, operations, financial condition or
results of operations.
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IN WITNESS WHEREOF, the parties have caused
this Clarification of Agreement and Plan of Merger to be
executed as of August 3, 1995.
UNION PACIFIC CORPORATION
By /s/ X. Xxxxx Xxxxxxxx, III
Name: X. Xxxxx Xxxxxxxx, III
Title:
UP ACQUISITION CORPORATION
By /s/ Xxxx X. xxx Xxxxxxx
Name: Xxxx X. xxx Xxxxxxx
Title:
UNION PACIFIC RAILROAD
COMPANY
By /s/ Xxxx X. xxx Xxxxxxx
Name: Xxxx X. xxx Xxxxxxx
Title:
SOUTHERN PACIFIC RAIL
CORPORATION
By /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
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