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\ Tiie State of Nevada has duly issued to First Party a certificate of appropriation of water authorizing First Party to appropriate from said water hearing lands the amount of water which can he beneficially used by the First Party for railroad and domestic purposes not in excess of 2.5 cubic feet per second. Second Party is the lessee of, in possession of and maintains and operates all of the property of First Party above mentioned. Water Company is the owner of the right to put to beneficial use all water arising from the springs located upon the said water bearing lands which springs are known respectively as "Little Spring”, "Middle Spring" and "Big Spring". The State of Nevada has duly issued to the Water Company certificates of appropriation of water authorizing the Water Company to appropriate from said water bearing lands the amount of water which can be beneficially used by the Water Company for irrigation and domestic purposes, not in excess of 1.88 eubic feet per second and the amount of water which can be beneficially used by Water Company for municipal supply and domestic purposes not in excess of 21.49 eubic feet per second. The Second Party uses a portion of the water developed from the said water bearing lands for railroad purposes and for the purpose of supplying certain customers who purchase water from the Second Party under private contract. All of the rest of the water produced from said lands above described is delivered to the Water Company by Second Party. -2