AGREEMENT

THIS AGREEMENT made and entered into as of the 1st day of June, 2004, by and between Northern Indiana Public Service Company, an Indiana corporation operating with its principal office in Merrillville, Indiana, its successors and assigns (hereinafter referred to as the Company) and the United Steelworkers of America, AFL-CIO-CLC, on behalf of Local Union No. 13796, United Steelworkers of America, AFL-CIO-CLC, (hereinafter referred to as the Union):

WHEREAS, it is the intent and purpose of the parties hereto to provide a means of adjustment of differences that may arise from time to time, and to promote harmony and efficiency to the end that the Company, the Union, its members and the general public may mutually benefit, and to establish a basic understanding relative to rates of pay, hours of work and other conditions of employment.

Neither the Company nor the Union shall discriminate against any employee in the application of the terms of this Agreement because of race, creed, color, national origin, disability, sex, sexual orientation, or age in violation of any state or Federal law.

NOW, THEREFORE, in consideration of the mutual promises and obligations assumed herein, the parties hereto agree as follows:

Recognition

1. The Company recognizes the Union as the exclusive representative for the purpose of collective bargaining with respect to the rates of pay, wages, hours of employment and other conditions of employment for all office and clerical employees whose classifications are contained in this Agreement, but excluding those employees who, because of the confidential nature of their work, have been, or may be in the future, specifically designated for exclusion from the bargaining unit by mutual agreement between the Company and the Union.

2. The Company also recognizes the Union as the exclusive representative for the purpose of collective bargaining with respect to the rates of pay, wages, hours of employment and other conditions of employment for the employees of corporations later acquired, new plants built or new departments established, whose operations are consolidated with the operations of the Company and who perform the same classifications or nature of work as those employees theretofore covered by this Agreement.

1. All employees whose classifications are contained in Schedule A of this Agreement and who do not elect to become members of the United Steelworkers of America, AFL-CIO-CLC, Local 13796, their exclusive bargaining representative, shall, as a condition of employment, pay to the Union, directly or by way of a proper authorization for payroll deduction to the Company, an amount of money equal to that paid by other employees in the bargaining unit who are members of the Union, which payment shall be limited to an amount equal to the Union's regular and established initiation fee and its regular and established monthly dues. Employees who fail to comply with the foregoing provision will, upon written notice by the Union to the Company, be placed upon five (5) calendar-day notice and at the end of such notice period, having failed to comply with the provision, will be removed from the active service of the Company. Having been so removed the employee will have no re-employment or seniority rights with the Company or any other right or benefit of any sort whatsoever. Employees affected by this provision shall comply within thirty-one (31) days after employment.

2. The Company will check off monthly dues, assessments^{^[1]} and initiation fees each as designated by the International Treasurer of the Union, as membership dues in the Union, on the basis of individually signed voluntary check-off authorization cards in forms agreed to by the Company and the Union.

Any employee, hired into, transferred into or organized into this bargaining unit will receive a "packet" supplied by the Local Union and issued by the Company at the time said employee comes into the jurisdiction of this bargaining unit. The Company will not be responsible for maintaining a supply of packets or assume any penalty in connection with this provision.

^{^[1]}Note: “Assessments" shall mean only those assessments approved by the Union under its Constitution and uniformly imposed upon the membership, and shall not include fines of any nature.

At the time of her employment the Company will suggest that each new employee voluntarily execute an authorization for the checkoff of Union dues in the form agreed upon. A copy of such authorization card for the checkoff of Union dues shall be forwarded to the Financial Secretary of the Local Union along with the membership application of such employees.

In the event said employee refuses to sign a check-off card at the time of her employment, the Company will send the Local Union office a receipt signed by the employee, or noted otherwise, stating that she received her Union packet on the date she was employed under the jurisdiction of this bargaining unit. These receipts will be mailed weekly to the Local Union Office in stamped envelopes provided by the Union.

At the close of each week, the Company will furnish to the President of the Local Union and to the office of the United Steelworkers and Financial Secretary, a list of any employees hired into, transferred into or organized into the jurisdiction of this bargaining unit, also any removals or transfers out of this bargaining unit. The list of new employees will include the addresses of such employees and the date of employment for those whose classifications are contained in Article XXIII, Schedule A and such employees will be listed by districts and operating departments.

New check-off authorization cards will be submitted to the Company through the Financial Secretary of the Local Union at intervals no more frequent than once each month. On or before the last day of each month the Union shall submit to the Company a summary list of cards transmitted in each month.

Deduction on the basis of authorization cards submitted to the Company shall commence with respect to dues for the month in which the Company receives such authorization cards or in which such card becomes effective, whichever is later. Dues for a given month shall be deducted from the first pay closed and calculated in the succeeding month.

In cases of earnings insufficient to cover deduction of dues, the dues shall be deducted from the next pay in which there are sufficient earnings, or a double deduction may be made from the first pay of the following month, provided, however, that the accumulation

of dues shall be limited to two (2) months. The International Treasurer of the Union shall be provided with a list of those employees for whom double deductions have been made.

The Union will be notified of the reason for non-transmission of dues in case of layoff, discharge, unit transferal, resignation, leave of absence, sick leave, retirement, death or insufficient earnings.

With respect to check-off authorization cards submitted directly to the Company, the Company will deduct initiation fees unless specifically requested not to do so by the International Treasurer of the Union after such check-off authorization cards have become effective. The International Treasurer of the Union shall be provided with a list of those employees for whom initiation fees have been deducted under this paragraph.

The provisions of this Section 2 shall be effective in accordance and consistent with applicable provisions of Federal law.

3. The Company shall remit the total amount thus deducted to the International Treasurer of the International Union, not later than the fifteenth (15th) day of the following month. An alphabetical list of the employees covered thereby shall be sent to the Financial Secretary of Local Union 13796.

4. The Union agrees to indemnify and hold the Company harmless from and against any and all claims, demands, actions, suits, or any other types of liability that may result from any action taken by the Company pursuant to Section 2 of this Article or in reliance on any notice, list, or other written information received by the Company from the Union or any employee regarding Section 2 of this Article.

1. It is understood and agreed between the parties that, subject to the conditions contained in this Agreement, the Company has and shall continue to have vested in it the exclusive right to exercise the duties of management, to plan, direct and control the working operations and force, including the right to hire, suspend, demote, promote, discharge for just cause, determine the adequacy of supervision, relieve employees from their duties because of lack of work or materials and for other legitimate reasons, and designate the hours of employment.

1. Any employee covered by this Agreement who is elected as a permanent Union Officer or as a delegate to a Union Convention or meeting requiring a temporary leave of absence may make a request to the Company for such leave of absence without pay, and the Company shall grant such leave, provided, however, if the employee wishes a leave for fifteen (15) days or longer, she shall give written notice to the Company at least seven (7) days in advance of such leave. However, an employee serving on the Grievance Committee or as an Officer of the Union who is required to be absent for Union business for her Local Union shall be considered to have complied with the requirements when verbal notice is given to her immediate Supervisor.

2. The Union shall not request a leave for more than two (2) employees in any one department at the same time. If two (2) employees from any one department on leave at the same time would interfere with the efficient operation of the Company's business, the matter shall be taken up between the Company and the Union and satisfactory adjustment shall be made.

3. At the end of her term of office or the completion of her mission, as the case may be, the employee shall resume her employment with the Company at her former rate of pay adjusted to reflect any increase or decrease applicable to such employee which may have become effective during such leave of absence.

4. Any employee granted a leave of absence by the Company while acting as a Representative of the Union, elected or appointed, shall retain full seniority rights for a period of three (3) years. In the event such leave of absence exceeds three (3) years, that period in excess of the three (3) years shall be excluded in computing the length of service of such employee with the Company.

5. The above provisions are subject to the seniority provisions of this Agreement hereinafter set forth.

1. It is expressly understood and agreed that the services to be and being performed by the employees covered by this Agreement pertain to and are essential to the operation of a Public Utility and to the welfare of the public dependent thereon, and in consideration thereof, and of the agreement and conditions herein by and between the Company and the Union to be kept and performed, the Company and the Union mutually agree that during the term of this Agreement there shall be no lockouts by the Company and there shall be no strikes, stoppages of work or any other form of interference with any of the production or other operations of the Company by employees in the bargaining unit.

2. When an employee is interviewed by a Supervisor or member of Management for any reason, the employee shall have the right to request and require the presence of that appointed or elected Union representative most readily available as a witness or advisor if she so desires. She may request this prior to or during the interview but may not insist upon a particular individual if another of equal rank in the Union organization is more conveniently and readily available.

3. All disputes and controversies arising under or in connection with the terms or provisions hereof shall be subject to the grievance procedure hereinafter set forth:

When an employee considers herself aggrieved, she shall discuss the incident with her Supervisor and her Steward. If the issue has not been settled by the end of the employee's next working day, it may be taken to Step 1 of this procedure.

If a settlement is reached before the grievance is reduced to writing, a pre-grievance form shall be filled out and the Grievance Committeeperson must sign and approve the document. One copy will be given to the grievant, the Supervisor will retain one (1) copy and will mail one (1) copy each to the Grievance Committeeperson and the Local Union Office.

Step 1: The employee will obtain a Grievance Form and complete the upper portion stating her grievance and other pertinent information. The form will be presented to her Supervisor

within fifteen (15) scheduled days (Grievant's scheduled days off and Holidays excluded) after the event causing the grievance. The Supervisor will sign and date the form acknowledging the request of the employee for a grievance hearing. The Supervisor will retain all copies pending completion of the form and give the employee a receipt indicating that her grievance has been submitted.

The Supervisor will arrange for a grievance hearing as soon as practical, but no later than ten (10) scheduled days (Grievant's scheduled days off and Holidays excluded) after receiving the Grievance Form from the employee. The Step 1 grievance will be between the Grievant, her Steward, the Grievance Committeeperson, or their nominees, and those witnesses as both the Union and Company agree are needed to resolve the grievance, the Supervisor and Manager of the local unit involved and/or the Superintendent or their appropriate designees. At the conclusion of the hearing, the Company will complete the lower portion of the Grievance Form. The completed form will serve as a statement of the employee's grievance and the Supervisor's response. One (1) copy of the completed form will be provided to the employee and one (1) copy to her Union Representative at the conclusion of the hearing, if possible, but in any event within five (5) scheduled days (Grievant's scheduled days off and Holidays excluded) after the date of the hearing. The Supervisor will retain one (1) copy for the local file and mail one (1) copy to the Manager of Labor Relations and one (1) copy to the Chairman of the Grievance Committee at the Local Union Office.

Safety grievances involving an immediate threat to the safety and/or health of employees will be given priority in the grievance procedure.

In Step 1 the grievant and other Union participants will receive their base wages for time spent at the grievance if heard during their regularly scheduled hours (excluding overtime hours).

Step 2: If an adjustment of the grievance cannot be reached in Step 1, and the aggrieved employee elects to proceed to Step 2, the employee or Steward, at the employee's request, shall reduce the grievance to writing on the Union's Grievance Form, stating all particulars, and shall furnish a copy signed by the Steward to the Local Union Grievance Committee.

Should the Union intend to pursue the grievance to Step 2, the Union will send written notice of such intent to the Manager of Labor Relations and to the Manager of the local unit involved within sixty (60) working days (Saturdays, Sundays and Holidays excluded) following the date the completed Grievance Form is received in the Union Office.

Upon timely notification from the Union to the Manager of Labor Relations, the Company shall arrange for a Step 2 Grievance Hearing to be scheduled not more than sixty (60) calendar days after receipt of notice to proceed to Step 2. The hearing will be conducted at the District, Plant or Department in which the grievance originated, unless another location is mutually agreed to by the Company and the Union. The Company will be represented by the Manager of Labor Relations, or his appropriate designee. The Union will be represented by the International Staff Representative, the Local Union President and the Local Union Chairperson of the Grievance Committee, or their appropriate designees and any other participants as the Union and Company agree are pertinent to the resolution of the grievance. (The Company and the Union may mutually agree, in order to expedite a particular grievance or grievances, to hear these grievances at the Company's Corporate Office.) Union participants in Step 2 will receive their base wages for time spent at the grievance if heard during their regularly scheduled hours (excluding overtime hours).

Minutes of the 2nd Step hearing shall be prepared by the Manager of Labor Relations or his representative within ten (10) days (Saturdays, Sundays and Holidays excluded) of the hearing date. Four (4) copies of the minutes shall be mailed to the Office of the United Steelworkers, Local 13796, for their signatures.

Any corrections or additions to the minutes may be prepared by the Union and shall be returned to the Company along with one (1) signed copy of the minutes, within sixty (60) calendar days, measured from the date the minutes are received in the Union office.

If an adjustment cannot be reached pursuant to and in the manner hereinabove set forth, the specific grievance may be submitted to arbitration upon the election of either the Company or the Union by written notification to the other party within sixty (60) calendar days from the date of receipt of the signed minutes of the Step 2 hearing by the Company.

Prior to the scheduling of a grievance to be heard in regular arbitration a meeting may be called, at the request of either party, between the Manager of Labor Relations and the International Union Staff Representative, or her designee for the purpose of attempting to mutually resolve the grievance without going through the arbitration process.

Step 3: A. ARBITRATION: If an adjustment cannot be reached in Step 2, the specific grievance may be submitted to arbitration by the International Staff Representative by written notification to the Company within sixty (60) calendar days from the date of the receipt of the signed minutes of the Step 2 Hearing by the Company.

B. A permanent panel of arbitrators shall be established to hear all grievances submitted to arbitration except those submitted by mutual agreement for resolution under the Expedited Arbitration Procedure. Maximum of three (3) arbitrators will be selected by mutual agreement of the Company and the Union. Each arbitrator selected will be notified of her selection and asked to indicate acceptance or rejection of the appointment. If any arbitrator rejects appointment to the panel, a replacement shall be selected by mutual agreement.

C. The Company and the Union each may notify the other in writing, during June of each year of the term of the Agreement that they desire to remove one (1) arbitrator from the permanent panel. That arbitrator shall then be notified of her removal by a joint letter from the parties; provided that an arbitrator who has been selected to hear a particular grievance shall not be removed from the panel pursuant to notice timely given by either party until after she has heard that grievance and rendered an award. If an arbitrator is so removed from the panel, a replacement shall be selected by mutual agreement of the parties within thirty (30) days after the removal.

D. The priority for selection of an arbitrator shall be determined by the dates of submission of the grievances to arbitration, with the earliest submitted grievances receiving priority for selection of arbitrators provided that such priority for the selection of an arbitrator may be changed by the mutual agreement of the Company and Union. If the arbitrator selected for a particular grievance cannot hear that grievance within two (2) months from the date she is notified of her selection she shall be bypassed and another arbitrator shall be selected by lot and so on until one is selected who can hear that grievance within the two (2) month time limit.

E. The arbitrator shall be governed by the terms of this Agreement and shall have no power to add to, detract from or change its terms. The decision of the arbitrator shall be accepted as final and shall be complied with by the employees, the Company and the Union. This decision shall be in writing, a copy of which shall be delivered to each of the parties in regular course, and the decision shall, if required, include the necessary time for compliance with the provisions or directions thereof by the Company and/or the Union, or those represented by the Union.

F. Either party may arrange for a transcript of the arbitration hearing. If both parties request copies of the transcript, they shall split the fees and expenses of the reporter, and the party arranging for the transcript will pay the cost of the arbitrator's copy of the transcript. Each party will pay for its own copy of the transcript.

G. Either party requesting a brief will notify the other party fifteen (15) days prior to the date of the hearing.

H. The expenses and fees of the arbitrator shall be shared equally by the Company and the Union, and each party shall bear the responsibility for compensating its own witnesses and representatives at the arbitration hearing.

I. The grievance will be heard at the District, Plant or Department where the grievance originated unless the parties agree on another location.

J. Prior to the scheduling of a grievance to be heard in Regular Arbitration, a meeting may be called, at the request of either party, between the Manager of Labor Relations and the International Union Staff Representative, or their designees, for the purpose of attempting to mutually resolve the grievance without going through the arbitration process.

DISCHARGE GRIEVANCES: The 1st Step of the grievance procedure, at the election of the Company or the Union, may be bypassed and the grievance be heard in the 2nd Step.

All discharge grievances shall be heard in the 2nd Step within forty-five (45) calendar days from the date of the discharge (Saturdays, Sundays and Holidays excluded).

ARBITRATION-DISCHARGE: The Company and the Union shall agree on a list of Arbitrators (5 to 8 in number). An Arbitrator shall be selected from this list, according to her availability, to hear the discharge grievance within a reasonable time.

EXPEDITED ARBITRATION: The following expedited arbitration procedure is hereby adopted.

The expedited arbitration procedure is designed to provide prompt and efficient handling of all cases within such procedure.

A panel of arbitrators sufficient to insure the intended operation of this procedure shall be jointly selected by the representatives of the parties to this Agreement. Such panel should be selected from the American Association of Arbitrators or Federal Mediation and Conciliation Service. This panel when established, will remain in effect for no less than one (1) year.

The expenses of this procedure shall be borne equally by the Company and the Union.

Upon receipt of the Step 2 minutes as provided in this Article, the Union designee and the Company designee may agree in writing to appeal the grievance to an arbitrator under this expedited arbitration procedure.

As soon as the Union designee and the Company designee agree to appeal a grievance under this procedure, they shall notify the designated arbitrator.

The designated arbitrator is that member of the panel who, pursuant to a rotation system, is scheduled for the next arbitration hearing.

Immediately upon such notification, the designated arbitrator shall arrange for the hearing to take place not more than twenty (20) working days thereafter in the plant or district where the grievance originated.

If the designated arbitrator is not available to conduct a hearing within the twenty (20) days, the next panel member in rotation shall be notified until an available arbitrator is obtained.

D. Each party's case shall be presented by a previously designated representative.

E. The Arbitrator shall have the obligation of assuring that all necessary facts and considerations are brought before her by the representatives of the parties.

F. The Arbitrator may issue a bench decision at the hearing; but in any event, she shall render her decision within forty-eight (48) hours after the conclusion of the hearing. Her decision shall be based on the record developed by the parties before and at the hearing and shall include a brief written explanation of the basis for her conclusion.

These decisions will not be cited as a precedent in any discussion of complaints or grievances at any step of the grievance or arbitration procedure.

Time spent by Union participants during normal work hours in Steps 1 and 2 shall be paid by the Company in the usual manner.

4. No grievance may be filed by the aggrieved employee later than fifteen (15) days (Saturdays, Sundays, and Holidays excluded) after the event causing the grievance.

5. If more than one (1) employee considers herself aggrieved by the same incident all such must file their grievances within the fifteen (15) days (Scheduled days off excluded) following the incident. If multiple individuals file timely grievances regarding a single incident, the Grievance Committeeperson shall combine all such grievances under a single grievance prior to pursuing the Step 2 Hearing.

6. Only those grievances which have been filed in the manner set forth in the grievance procedure will be considered in the final settlement of the grievance or grievances.

7. The Company will not discipline an employee more than fifteen (15) days (Saturdays, Sundays, and Holidays excluded) after the date of the incident. The fifteen (15) day period will not apply and the Company may discipline an employee at any time for the reasons of dishonesty on the job, stealing of Company property, or if an employee is convicted of a felony and is subjected to a prison term.

8. The District or Department issuing a letter of reprimand or warning to an employee will send a copy of the letter to the home address of the Grievance Committeeperson involved, the Local Union Office and the President of the Union.

9. Employees who are removed from the payroll during their probationary period shall have no recourse to the grievance procedure.

10. In the event an employee is suspended or discharged, the Company shall mail to the Grievance Committeeperson of the Union Division in which the action occurs, and two (2) copies to the Local Union President at the Union Office of the United Steelworkers, Local 13796, a detailed report of the case together with all pertinent background information not later than ten (10) working days following the effectiveness of such suspension or discharge (Saturdays, Sundays, and Holidays excluded). This procedure does not apply to layoffs or reduction in the work force. Not later than fifteen (15) days after mailing such notice, the Union shall initiate any action considered appropriate. Suspensions shall be heard in the expedited arbitration process as soon as possible upon the receipt of the grievance report.

11. Should the terms or provisions contained in this Agreement appear to be violated and the employee or employees affected thereby decline to initiate or follow through the grievance in the grievance procedure hereinabove set forth, then the Local Union Grievance Committee shall, within forty-five (45) working days after the apparent violation, file a grievance in Step 1 to resolve the matter and, if necessary, invoke all the subsequent steps hereinabove specified.

12. Neither party shall bring, or cause to be brought, any court or other legal or administrative action against the other until the dispute, claim, grievance or complaint shall have been brought to the attention of the party against whom it shall be made, and said party shall have failed to correct the matter to the satisfaction of the other party.

14. Grievances resulting in a monetary settlement in favor of the employee in the second and third years of the Agreement may be retroactive to the effective date of the Agreement.