Calgary, December 5th, 2007

Brothers & Sisters,

It is with great pleasure that we announce to you that we have reached a tentative agreement with the Company, late last night. We worked around the clock to push the Company as far as possible in the best interest of our members without going on strike. We we are finalizing the MOS but we understand that our members are waiting for news. With that in mind I have outlined a summary of the agreement for the benefit of our members. We were successful in improving our MOS as outlined bellow.

In solidarity,

Daniel Généreux
General Chairman TCRC
Trainmen East

1) Performance Incentive Program

• Create a Performance Incentive Program not later than July 1st, 2008 which
  provides for up to a maximum 5% payout.

2) In and off in 10 hours - Penalty Payment & Penalty Rest

• Special provision for an $80 penalty payment when crews provide notice enroute, are relieved and do not arrive at the objective terminal within 10 hours.
• If crews give notice for rest and are not in and off duty after 10 hours, crews will be able to book additional rest over 24 hours.

3) Home Terminal Rest

• New option for pool and spareboard employees to book 24 hours rest and establish placement at foot of board at the expiration of rest.

4) Benefits

• Clear assurances that Co-pay will not apply on an individual basis but will be based on the overall costs of the bargaining unit. Employees will not pay 10% of their own costs but only 10% of the premium for health & dental benefits. The union is to have the ability to review all costing . Provide example for clarification.
• Update Benefit Committee letter to clarify Union involvement. Establish a clear process where Union is involved in ensuring the benefits provider is properly administering the benefits program.
• Provide updated benefit booklets to all employees.
• Add clear language that the parties will meet within 90 days to develop a cost neutral drug card with an anticipated implementation of July 1, 2008.

5) Earned Days Off

Clarify how earned days off are earned and when they can be taken.
Changes include:

• Clarify that EDOs cannot be denied by management when taken during your window and with 72 hours notice being provided.
• EDOs apply to both road and yard employees.
• 1 EDO is earned for every 4 week period an employee is available. This is a
  rolling period. Weeks to be coincident with weekly crew change.
• Clarification that process for booking back on from EDOs will be the same process currently used at a terminal for returning from a LOA.
• Review of program to include the possibility of changing the start/end time of the window and process for booking back on, among other items.
• Assurances that the review will not result in reducing the EDO benefits.

6) Crew Management Center

• Commitment by the company and detailed process to address concerns
  regarding the ability of RTEs to contact a crew dispatcher in a timely fashion, the calling of crews at the away from home terminal by the Automated Crew Calling System, as well as ensuring that weekly crew changes are completed
  in a correct and timely manner.
• Process to include a joint identification of solutions, implementation and audit. Plan to be developed within next 6-8 weeks.

7) Monthly Mileage

• Commitment that changes made in the current Memorandum of Settlement which impact monthly mileages will not result in the lay off of employees hired prior to January 1st, 2008.

8) Union Security

• Clarify that upon ratification, managers will have 60 days to decide whether to remain in management ranks or return to property. If they decide to stay and have more than 365 days as a manager, their seniority will be frozen at the end of the 60 day period.