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Comment: The contract failed to make any provisions either for depreciation or retirements after the cutoff date of September 1, 1952. Depreciation will run at a rate of around 2% or 3$ a year and can amount to a substantial sum of the total purchase price of $2,500*000* Moreover, the contract failed to make any provision in the event that any of the property were lost, destroyed or retired prior to the sale date. Thus, for example, if one of the trucks were to be destroyed, there is no provision for adjustment on account of such destruction. As will hereinafter be indicated, it is hoped that we can persuade Union Pacific to agree to a later termination date than December 31» 1953* In the event that Union Pacific does agree to a later termination date, it is possible that the contract might be in effect for a period of two or three years before the sale date. Ih^that event the amount for depreciation and retirements could be a very substantial figure and one which the District would be unable to stand. Accordingly, it would appear that if a flexible termination date is to be established that sume provisions must be made for depreciation and retirements. 4. Additional Additions and Betterments ror Extensions of the Water System After the Contract Date. Union Pacific's draft would permit them to make any additions they desired to 3.