(i) The descriptive words at the heads of the several sections of this agreement and the table of contents are inserted for convenience merely, and are not to be used in the construction of the agreement.

SECTION 2.-PROPERTY TAKEN OVER.

SEC. 2. The Company's railroad and system of transportation of which the President has taken over possession, use, control, and operation shall be considered as including:

(a) The following roads and properties:

together with all branches and tracks, trackage, bridge, and terminal rights, and lines of railroad owned by or leased to and operated by the Company as a part of its system of transportation, and all other property of the Company with the appurtenances thereof, whether included in the foregoing list or not, the revenues of which were used, or which, if the property had been then owned by or leased to it and had then been revenue bearing, would have been used, in computing the Company's standard return.

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The Company reserves to itself the benefit of all leases (and of all rents and revenues accruing therefrom), of parts of its right of way, station grounds, and other property, the revenues from which under the accounting rules of the Commission in force during the test period were properly creditable to "miscellaneous rent income or “miscellaneous income." The Company grants to the Director General all its rights to terminate leases of any part of its right of way, yards, or station grounds, and to occupy and use the premises of any such lessee when, in his judgment, the same is required for operating purposes. The Company shall have for its own benefit the right to lease for industrial sites or other purposes such portion of its right of way, yards, or station grounds, or structures thereon, as are not required by the Director General for operating purposes, and to receive and enjoy the rentals therefrom, subject to the right of the Director General to cancel any such lease and to occupy the premises or structures whenever, in his judgment, the same are necessary for operating purposes. All expenses connected with any such property heretofore or hereafter leased or otherwise occupied, as in this paragraph provided, including taxes thereon which during the test period were not charged to railway tax accruals, shall be paid by the Company while receiving the revenues therefrom.

(b) All materials and supplies on hand at midnight December 31, 1917.

(c) All balances in the account or accounts representing the total of "Net balance receivable from agents and conductors" as of midnight December 31, 1917;

SECTION 3.-ACCEPTANCE.

SEC. 3. (a) The Company accepts all the terms and conditions of the Federal control act and any regulation or order made by or through the President under authority of said act or of that portion of the act approved August 29, 1916, referred to in paragraph (a) of the preamble to this agreement which authorizes the President in time of war to take possession, assume control, and utilize systems of transportation; and the Company further and expressly accepts the covenants and obligations of the Director General in this agreement set out and the rights arising thereunder in full adjustment, settlement, satisfaction, and discharge of any and all claims and rights, at law or in equity, which it now has or hereafter can have, otherwise than under this agreement, against the United States, the President, the Director General, or any agent or agency thereof, for compensation under the Constitution and laws of the United States. for the taking possession of its property, and for the use, control, and operation thereof during Federal control, and for any and all loss and damage to its business or traffic by reason of the diversion thereof or otherwise which has been or may be caused by said taking or by said possession, use, control, and operation.

No claim is made by the Company for compensation for the period between noon of December 28 and midnight of December 31, 1917; and the revenues of said period shall belong to the Company, and the expenses thereof shall be paid by the Company, allocated in both cases as provided in paragraph (b) of section 4 hereof.

(b) The Company, on its own initiative or upon the request of the Director General, shall take all appropriate and necessary corporate action to carry out the obligations assumed by it in this agreement or lawfully imposed upon it by or pursuant to the proclamation of December 26, 1917, or by the Federal control act.

(c) The Federal control act being in section 16 thereof expressly declared to be emergency legislation enacted to meet conditions growing out of war, nothing in this agreement shall be construed as expressing or prejudicing the future policy of the Federal Government concerning the ownership, control, or regulation of the Company, or the method or basis of the capitalization thereof, and the recitals or provisions of this agreement shall not be used, as evidence or otherwise, by or against either party hereto in any pending or future proceeding which involves the acquisition or valuation of the Company's

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ices of the Company. Like methods of accruing and allocating revenues shall be made at the end of Federal control.

› All expenditures made by the Director General during Federal 'ol for additions and betterments, exclusive of equipment, or for isions begun prior to January 1, 1918, shall be charged to the pany, and if the completion of any such addition, betterment, or ision is approved or ordered by the Director General, the Comshall be entitled under the provisions of paragraph (d) of sec7 hereof to interest on the cost thereof from the completion of work; but no interest (except to the extent that the same may be wed and included in the compensation provided for in paragraph of section 7 hereof) shall be due the Company upon any such enditures for work done prior to January 1, 1918. Payments for equipment ordered or under construction by the Company prior to uary 1, 1918, but delivered on or after that date, shall also be conered as expenditures made by order or approval of the Director neral under paragraph (d) of section 7 hereof. Interest during struction payable under this paragraph, and also interest during struction on the cost of any additions, betterments, and road exsions made by the Company or at its expense to the Company's operty during Federal control, shall be included in the cost of the rk.

(d) Cash receipts or disbursements and other items arising out of ansactions which do not enter into or form a part of those used determining the Company's standard return shall not be received paid by the Director General unless such transactions are negoated or conducted by his order for account of the Company and ith its consent. When moneys are so received or paid by the Direc›r General in connection with such corporate transactions they shall

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credited or charged to the Company. There shall be an accounting f the amounts due by one party or the other under this paragraph t the end of each quarter year of Federal control, and the amount > found due shall be then payable and if not paid shall bear interest s provided in paragraph (a) of this section.

(e) All sums paid by the Director General to maintain pension unds or pension obligations or practices, and all contributions to Young Men's Christian Associations of employees, employees' savngs funds, relief funds or associations, reading rooms, or health, acident, or death benefits for employees, shall be treated as a part of railway operating expenses during Federal control.

(f) All salaries and expenditures incurred by the Company during Federal control for purposes which relate to the existence and maintenance of the corporation, or to the properties of the Company not taken over by the President, or to negotiations, contracts, valuations, or any business controversy with the Government or any branch

property or any part thereof; but nothing in this paragraph shall be taken or construed as affecting the settlement and discharge contained in paragraph (a) of this section, nor as limiting or qualifying any of the provisions of said paragraph for the purposes thereof, nor as limiting the use of this agreement as evidence in any proceeding under this agreement or under the Federal control act.

SECTION 4.-OPERATION AND ACCOUNTING DURING FEDERAL CONTROL.

SEC. 4. (a) All amounts received by the Director General under paragraph (c) of section 2 hereof and all other amounts whether received from the Company in cash or collected or realized upon by him from current operating assets belonging to the Company or arising from railway operations prior to midnight of December 31, 1917, shall be credited by him to the Company; and the Director General shall, to the extent of the cash so received or realized, pay and charge to the Company all expenses arising out of railway operations prior to January 1, 1918, including reparation claims, and, unless objected to by the Company, may pay and charge to the Company any of such expenses, including reparation claims, in excess of the cash so received or realized. Balances of the above accounts shall be struck quarterly on the last days of March, June, September, and December of each year, and the cash balance found on such adjustments to be due either party shall be then payable and, if not paid, shall bear interest at the rate of 6 per cent per annum, unless the parties shall agree upon a different rate; except that the rate of interest on any portion of a balance found due to the Company which is derived from cash in bank to the credit of such Company on interest, shall be adjusted in each case independently of this contract as the parties may agree.

(b) Railway operating expenses, reparation and other claims, hire of equipment and joint facility rents shall be allocated with reference to the time when incurred as between the period prior and subsequent to midnight of December 31, 1917, and as between the period of Federal control and the period subsequent thereto. Railway operating revenues shall be allocated as between the period prior and subsequent to midnight of December 31, 1917, in accordance with the established accrual practices of the Company; except that where prior to midnight of December 31, 1917, the Company's part of a service on through business had been completed or carload lots on its own line had reached destination, the revenue of the Company for such service shall be allocated to it; but as to classes of traffic where in the opinion of the Director General such allocation will involve undue delay or undue absorption of accounting labor, such revenues shall be allocated in accordance with the established accrual