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(bee - Mr. W. H. Johnson June 12, 1953 File 80-11 Franklin T. Hamilton, Esq. 0*Melveny & Myers 433 South Spring Street Los Angeles 13, California Dear Frank* Prior to the time the agreement dated June 1, 1953, be­tween our companies and the Las Yegas Valley Water District for the sale of the water system at Las Vegas was entered into, the Railroads had granted an option to sell a parcel of land within the boundaries of the shop grounds as defined in Section 2 of the agreement. The option agreement provid­ed that when the option was exercised, the Railroads wouldt convey the property to the purchaser and that the deed con­veying the land would contain a reservation of water and water rights appurtenant to the parcel purchased in substan­tially the following languages "And also excepting from this grant and reserving unto the First Party, its successors and assigns, all water and water rights appurtenant to the lands hereby conveyed." The party holding the option has exereised the option, and we are asked to prepare a deed to carry out our obligations un­der the option. At the present time the Railroads are also about to en­ter into an option to sell another parcel of land in the shop grounds to a third person and propose to except the water and water rights appurtenant to the option parcel by using the language above quoted. Although the language above quoted is not exactly the same as the language used in Section 2 of the agreement of