Note of se
Conference Room | Avosday. 16°
1967.
Present
Mr. Sowden
Mr. Mullineaux
Kr. looney
Er. Karden
Kr. Birtwistle
Mr. Brothers
Ex. Williama
}
Richard Costain (C.E.) Ltd.
}
Cross Harbour Tunnel Co. (Hong Kong).
Kr. Culverwoll
Kr. Thompson
Kr. Cotterill
Mr. Lowton
Mr. Broad
Soott Wilson à Co. Ltd.
Freeman, Fox á Partners.
Peat Karwick & Co.
Special Guarantees (Constructional Wozka).
H
Kr. Kiliott
Mr. Burroughs
Hong Kong Tumel Project
After welooming Mr. Harden and his collesques of the Cross Harbour Tunnel Co., Mr. Cotterill explained tỏ them the functions of the Department and its procedures for insuring loans made by United Kingdəm benks to overwese borrowers. During the course of the exercise to underwrite the financing of the constructim of the tunnel, the decision had been taken that the Tunnel Company, at present formed, was not acceptable, unsupported, for the repayment of 110 millions loan. To make the Tunnel Company creditworthy had insisted on un-conditional guarantees of all payments due under the contract from aooey table third-parties. The principal share holders of the Tammel Company would be acceptable guarantors but Kr. Cotterill made it clear that we did not intend that the guarantees of payment should be related to the shares) we simply wanted guarantees fron oreditworthy sources
2. Kr. Sowden then moved the discussion of remaricing that it appeared to him that there discussed
3.
1.
2.
more specific matters by three main issues to
Settlement of the question of the provision of guarmtes of payment; the Tunnel Company had already agreed to give several guarantees or 771
The need of, and method of establishing a sinking fund
3. What happens when the Tunel Company goes 'public'.
Replying, Mr. Cotterill said that it was our understanding that the Tunnel Company had proposed that the guarantees of payment given by the present major shareholders at date of contract, should be reduced pro rata to the number of shares sold at the time of conversion to a public company. This proposal was not acceptable. The guarantees ɔnce given in the several proportions of the majʊr share-holders were to remain constant and unalterable until the total debt was discharged.
Of the second item, it was agreed that the political risk vis Hong Kong being over-run by Chinese frʊn the mainland, should not be borne by the third- ♪ rty guarantors. Department were prepared to accept this risk, and in doing so would expect to be able to pursue any redress in Hong Kơng - but not beyond Hong Kong. (This last point has relevance is that the Tunnel Company
/10