A copy of this
has been filed with the Registrar Companies, Hongkong, pursuant to Section 38 of the Hongkong Companies Ordinances 1932. Application will be made to the Committees of the Hongkong and Manila Stock Exchanges for permission to deal in the shares of the Company,
The subscription list will be opened on the Seventh day of December 1996 and closed on or before the Ninth day of December 1936.
HONG KONG MINES, LIMITED.
CAPITAL
(Incorporated under the Hongkong Companies Ordinances 1992)
DIVIDED INTO
Hongkong $2,500,000
25,000,000 SHARES OF TEN CENTS EACH HONGKONG GE CURRENCY
TO BE ISSUED
20,000,000 SHARES
SHARES OF TEN CENTS EACH-HK$2,000,000
ISSUE AT PAR OF 15,000,000 SHARES OF TEN CENTS EACH PAYABLE IN FULL ON APPLICATION. 5,000,000 shares of Ten Cents each will be issued to the Vendor or his nominees credited as fully paid up in full satisfaction of the purchase consideration.
THE HONGKONG AND SHANGHAI BANKING CORPORATION are authorised as Bankers for and on behalf of the Company to receive applications for shares at the Head Office in Hongkong.
DIRECTORS:-DAVID WAI KWOK AU, Esq., of 6 Queen's Road, Central, Hongkong, Manager, The Shanghai Commercial & Savings Bank Ltd.;
FREDERICK JOHNSON GELLION, Esq., of Macao, Managing Director, Macao Electric Lighting Co., Ltd.;
JAMES ROXBURGH PATON, Esq., of Gloucester Building, Hongkong, Insurance Manager;'
JOSEPH MOWLAM WONG, Esq., J.P., of David House, Hongkong, Director, Shanghai Fire &-Marine Ins. Co., Ltd.;
CHARLES, CRAWFORD STARK, Esq., (Managing Director), of 274 The Peak, Hongkong, Merchant.
CONSULTING ENGINEER: JOHN FRANCIS MANNING, Bachelor of Science (Mining and Metallurgy), Harvard University.
BANKERS-THE HONGKÔNG & SHANGHAI BANKING CORPORATION.
SOLICITORS:-Messrs. DEACONS, No. 1, Des Vœux Road Central, Hongkong.
AUDITORS:--Messrs. LOWE, BINGHAM & MATTHEWS, No. 7, Queen's Road Central, Hongkong.
MANAGINGTM DIRECTOR:-CHARLES CRAWFORD STARK, Esq.
SECRETARIES:--Messrs. T. A. MARTIN & CO., Prince's Building, Hongkong.
-REGISTERED OFFICE-Queen's Building, First Floor, Hongkong Telephone No. 88552.
UBJECTS:- The Company was incorporated in Hongkong under the Companies Ordinances 1832 on the 18th day of November, 1930 with the objects specified in its Memorandum of Association, to acquire mining properties in Hongkong and elsewhere and mare particularly 18 acquire and work the property known an The Lin Ma Hang Mint Shataukok in the New Territories in the Colony of Hong Kong.
.
SITUATION OF THE PROFERTY:-- The property in situnted close to the British-Chinese frontier approximately 7 miles from Lu Wu and 3 miles from Shataukok in the New Territories of Hong Kong. The frontier road from Lo Wu to Shataukok runs at the foot of the hills in which the mine is situated. This road can easily be widened and affords direct access to the Kowloon Canton Railway and to the main road to Kowloon.
AREA: The area of the properly comprised in the Crown Lease is 160.16 neres.
TITLE:— The property is held ́under a Mining Lease from the Crown doted 23rd June 1925 for a term of 75 years from the 20th day of June 1922 nt a Crown Rental of $2.00 per acre together with a royalty payable to the Crown not exceeding 6% to be enlculated on the estimated market välue of the metal or mineral at the mine when ready for exportation or for smelting or reducing. The Crown Lease is now vested in the administrator of the estate of the late Morrison. Brown Yung and Martin Joseph Heller and others.
vendor is The
entitled to a
a sub-lease from the leseces
for a term of 10 years from
m the 10th present
day
of November 1036 on the Lerma and conditions contained in a letter dated 22nd September 1830 written
by Messrs. G. K. Hall Brution & Co. Include the payment of royalty of 30% to the Solleitora for the leasces to Messrs. Deacons, Solicitors for the vendor which terms lessecs who are responsible for the payment of the Crown royalty and the right to the sub-lessee to purchase the lessees' Interest in the Crown Lease for U.S. $100,000 within one year from the 22nd September 1930. On the exercise of this option the only royalty then payable would be 5% to the Crown.
HISTORY: It is believed that lead was first discovered in the Shalaukok area more than seventy years ago. The old workings are situate about half a mile from the present workings and form part of the property. It in understood that the main outcrop of the Lin Ma Hong Mine was discovered in 1915 during a search
for limestone. A certain amount
mount of preliminary work was subsequently done
and In 1917 a company was formed to work the property. This company operated the mine for three years and found that owing to absence of water in the winter months the waterwheel from which power was obtained and which was the role- source of power for the six-stamp mill could not be operated and in 1920 the company was wound up. The mine was subsequently operated by the late Morricon Brown Yung until his death in 1932; most of the existing workings were driven by him. Since that date a Chinese mining concern operated the mine for a short perlod with practically no plant but was successful, in extracting a certain amount of high grade ore.
REPORTS:---
TO THE DIRECTORS,
HONGKONG MINES. LTD., HONGKONG.
Gentlemen,
HONGKONG, 19 November, 1936.
REPORT ON THE LIN MA HANG MINE.
Acting on your instructions, I have made a thorough examination of the Lin Ma Hang Mine, having spent nearly six weeks on the property. I now desire to to tender my Report, as follows:---
SITUATION. The property is situated close to the Anglo-Chinese border on the Frontier Road about seven miles from Sheung Shui Police Station, and three miles from Sha Tau Kok Village The Tand ir ir dirt rand with good grader, but-it-is- narrow, and will need to be widened and surfaced to carry heavy traille when mining operations begin. egin.
GEOLOGY. The regional geology of the district has not been studied in great detais, or at least the results of any such studies are not avaliable. It is certain, however, that close to the mine the formation is igneous, and the granitold rocks were probably formed as a part of the Tel Mo Shan intrusions. Quariz Porphyry and other similar rocks are in evidence.
The formation has been much disturbed, numerous faults being evident, and some of the rocks close to the ore bodies have undergone metamorphism. Ore bodies have been formed by igneous magman Alling irregularly shaped open assures. In . many cases the ore bodies have been faulled after formation, and the cross fissures have been filled with quartz. Silicification has been intense, and as a result the ore 'Is usually very hard. In splie of this silicification, meteoric water is continually sceping through the formation, leaching out large quantities of iron sulphates and oxides and lesser quantities of other minerals. This leaching action is facilitated by the fact that the ore bodies are situated high above the bottom of the nearby valley with a consequent low ground water level which promotes the easy circulation of meteoric water through fault zones and other openings in the ore.
It is expected that, as a result of this leaching of minerals from the upper part of the mine, deposition has occurred at depth and that a zone of secondary enrich- ment will be discovered not far below the level of ground water.
In the vicinity of the mine some very small patches of limestone have been found, and some miles to the north an extensive area of limestone exists in which lead ores have been observed. It is probable that the Lin Ma Hang area was once covered by a sheet of limestone, and that the ore bearing magmos arose from depth during a period of Intrusion until the covering stratum of limestone was reached when deposition occurred, and the ore bodies were formed in open fissures and cavities of the igneous rocks and the limestone.
Since then eroston has been extensive enough to denude the southern edge of the limestone, exposing the older igneous rocks, and making possible the discovery of the ore bodies.
The ore is essentially Galena or lead sulphide with which a lesser quantity of Sphalerite or zine sulphide is associated, together with varying quantities of Pyrlie of iron sulphide, and smutier quantities of Chalcopyrite or copper sulphide. Silver is intimately associated with the Galena probably as Argentite or silver sulphide. I have taken, during the process of my examination, 148 samples of the ore from various Parks rationally, which have been analysed by the Philippine Engineering Corporation of
The proportion of Zine to Lead in the ore is low, and the proportion of Silver 10 Lead varies greatly, but both of these metals when concentrated are present in quantities large enough to have an important commercial value. DEVELOPMENT, Over a period of many years, a number of different organizations ́have worked on the development of Lin Ma Hang Mine. About 7,000 feet of drifts, cross-culs, raises, and winzes have been driven on the property by these different owners. About 5,000 feet of the development work has been done on No. 5 and No, O Adits where the bulk of the ora included in the ore reserves has been proved. A number of workings, amounting to about 2,000 feet in length but not connected with the main mine, are scattered along the strike. Several of these workings show patches of ore, and further development work at these points is ilkely to open satisfactory ore bodies,
+
The vein strikes cast and west (S50′E), and dips at an angle of about 35 10 the northeast. The angle of dip is very irregular, and the thickness of the ore also varies greatly, ranging fron a few inches to thirteen feet or more,
Out of a total length of strike about 9,000 feet, only about one third or 1,000 feet has been intensively developed. Scattered over the undeveloped pariton aggregating about 2,000 feet, there are many indications of ore which give promise that Important oré bodies may be found if a thorough-going development compaign is undertaken. A cross-section through the mine shows an ore, body extending for 300 feet along the dip from the tops of the raises above No. 0 Adit to the bottom of No. 5.Adit. In some of the lower detached workings there are occurrences of ore which indicate that it is reasonable to expect that orn bodies will be found along the dip for a distance greater than 700 feet,
ORE RESERVES. The mine has produced a considerable quantity of high grade ship- ing ore, and there still remains much high grade ore ready for extraction. The main value of the mine, however, Hles in a satisfactory tonnage of ore of milling grade. This óre will produce high grade concentrates after proper metallurgical treatment In a reduction plant
PROSPECTUS.
map, uncompleted at the time of the death of the late Mr. M. B.. Yung, shows a tonnage of 43,000 tons of ote containing 4,700 tons of lead, or an average of 10.0 per cent. The analyses of the samples taken prove that these Agures are substantially correct for the portions of the mine shown on the map. In addition, ! find that there are extensions of the workings exposing good ore that for some reason had not been plotted. The are shown in these extensions nearly doubles the ore reserve figures shown on the old map.
My investigations show that the positive ore reserves of Lin Ma lang Mine total 83,000 short tons (2,000 pounds) of ore with an average content of eleven per cent lend. This includes 15,000 tons shown near the portal of No. 6 Adit; 42,000 tons above No. 4 Adit and extending about 600 feet back from the east faces; 18,000 tons below No. & Adit near the winze connecting with No. 5 Adit, and 0,000 tons on the ore dumps outside the mine.. On the eastern section of No. 5° Adit there is good ere, exposed only on oneside, which I estimate at 2,000 short tons. Under "Develop ment" mention has been made of the territory yet to be explored and developed. I believe that over 100,000 short tons of ore of average grade can be developed in this territory, in addition to the positive ore of 83,000 short tons mentioned above.
It should be borne in mind that in addition to the value of the Lead in the ore, there are about 3 ounces Silver, and 3 percent Zine which will be largely recovered In the concentrates.
REDUCTION PLANT. The ore found in this mine, being a clean sulphide and not complex, renders the metallurgical probierns easy of solution. A 500 pound sample of representative ore is being sent to a metallurgical testing laboratory where a flow sheet will be compiled, and a complete chemical analysis of the ore will be made. It is expected that concentration followed by flotation of slimes will be found suitable In the treatment of the ore, sad that finely divided particles of ore carrying high values which were formerly lost, will be recovered.
I recommend a mill of fifty tons daily capacity, I confidently expect that after a brief period of testing of this first mill unit, a substantial addition to the plant will have to be ordered. The capacity will depend on the ore reserve estimate made on the 31st December, 1937. It is reasonable to expect that by that date the ore reserves will be co sulistantially augmented that a large increase of milling capacity will be needed.
About one half a mile west (down stream) of the mine close to the main road there is suitable site for a reduction plant, and close at hand there is room for living. quarters, godowns, etc. · At the point selected, two streams converge, giving a sumclent quantity of water
As the mine is situated high above the mill site, the ore will be transported to the mill on a hillside terrace having a grade of about one percent, and at an elevation such as to give ample head room for the réduction plant.
GENERAL As a result of my inspection and from the evidence-shown by the mengre mups at the mine, I am convinced that Lin Ma' Hong Mine should prove a very profitable undertaking it properly managed.
Its advantages are as follows:
It is well situated from the standpoints of health and transportation. Labour and fuel are obtainable of reasonable prices. Water supply is amply sufficient.
The ore reserve is adequate to warrant the erection of a fifly ton reduction plant as soon as possible, and during the erection of this plant, further reserves should be developed which will warrant a one hundred percent Increase in milling capacity. "Estimated operating profis and working costs are shown.-herewith.-—¿
I am,
Yours faithfull,
~~~(Sd.) J.-F. MANNING,
S. B. Mining and Metallurgy, Harvard University."
LIN MA HANG MINE - SUMMARY OF OPERATIONS, COST AND PROFIT.
TOTAL PROVEN ORE RESERVES:-
03,000 Short Tons 74,000 Long Tons. CURRENT MARKET PRICE, at Exchange 1/2-7/0.—
量
Lead £20:10:0: per ton
Silver 20-0/18d. per oz.
Zine £17:0:0: per ton
ASSAY VALUE OF ORE:-
Lead 11% -
Silver 3.0 oz. per short ton:3.36 oz, per long ton. Zinc 3%
QUANTITIES OF METALS AVAILABLE:
Lead 11% of 74,000 tons 8.140 tons x 95% Silver 3.36 oz. 74,000 tona-248,040 oz. x 95% Zine 3% of 74,000 tons=2,220 tons x 90 VALUE OF POSITIVE RESERVES:-
Lead
Silver
7,733 tona x HK$330.76 1.38 230,208 oz. X
274.28 Zinc-1,900 tons x
Total
ESTIMATED COMBINED MINING & MILLING COST=.. TOTAL OPERATING COST-
HK$17.00 x 74,000 tons
TOTAL OPERATING PROFIT.
excluding shipping charges
HK$330.70 -1.38 274.28
7,733 Lons 236,208 oz.
1,098
tons
HK$2,557,707.00
325,907.00 548.011.00 HK$3,431,745.00
HK$17.00 per ton
HK$1,250,000
HK$2,173,745
...
(Signed) J. F. MANNING, MANAGEMENT:- Mr. C. C. Stark has agreed to act as Managing Director of the Company. Mr. John Francis Manning will act as consulting Engineer to the Company and an efficient and experienced resident engineer and staff will be appointed to work the mine."
:
POLICY AND PROSPECTS:- Acting on Mr. Manning's recommendations * the Directors propose forthwith to order a modern flotation mill capable of treating 50 tons of ore dally which will be installed and put into operation at the earliest possible moment. The Directors intend to increase the mill capacity in the near futuro
is blocked out. further ore
The Directors propose to exercise the option to acquire the lessees' rights In the Crown Lease for U.S.$100,000; this will cost at the present rate of exchange
and will ensure the Company's inge approximately $320,000 and uninterrupted possession of the mine for the remainder of the term of 75 years granted by the Crown Lease, that is to say up to 1997. On the exercise of the option the only royalty then payable by the Company will be that to the Crown of 0%. Allowing for the Government Royalty, shipping charges, estimated general office and overhead expenses and depreciation, the Directors calculate that the net annual profits will be sufficient to provide substantial dividends,
PURCHASE CONSIDERATION The vendor to the Company, is James Roxburgh Paton of Hongkong who is also the promoter. The purchase consideration is the sum of $500,000 which is to be satisfied in full by the allotment to the said James Roxburgh Paton or his nominees of 5,000,000 shares of the Company at 18 Cents each credited as fully up. LA
2
CAPITAL EXURE AND WORKING, CAPITAL:—. After payment.
of the preliminary expenses, the costs of this issue, the cost of taking up the option and the assignment of the lease to the Company a sum of approximately $1,100,000 in cash will be available for the Company's purposes. Having in view the recommendations in regard to expenditure of Mr. John Francis Manning the Directors consider that this amount will be sufficient for all purposes.
GENERAL The Company was incorporated on the 18th day of November, 1938 under the Hongkong Companies Ordinances 1932 as a Company limited by shares. A copy of the Company's Memorandum of Association stating the names descriptions and addresses of the signatories thereto and the number of shares subscribed for by them respectively can be Inspected at the offices of the Company' Solicitors, p
AUDITORS', REPORT:~~e
THE DIRECTORS,
HONGKONG MINES, LTD., HONGKONG,
Gentlemen,
Hongkong, 20th November, 1938.
As Auditors of your company in compliance with the provisions of Hongkong Companies Ordinance 1832, Fourth Schedule, Part II, we hereby certify that at the Company was incorporated on the 18th day of November, 1930, only, no accounts have yet been made up and no dividends have yet been paid.
Yours faithfully,
LOWE BINGHAM & MATTIEMS,
Chartered Accountants.
STATUTORY INFORMATION:-The Articles of Association of the Company contains provisions to the, following effecti-
28. The qualification of every Director shall be the holding in his own right of 10,000 shares in the Company. A Director may act before acquiring his qualification.
00. The Directors shall be paid by way of Remuneration for their services the sum of $2,000 per annum in respect of each Director or such sumb as the Company in General Meeting may from time to time determine and such remuneration shall be deemed to negrue de die in diem and shall be payable by half-yearly Instalments.
103. The Directors may at any time appoint a Managing Director of the Company either for a fixed time or without any limitation as to the period for which he is to hold office and may from time to time relleve or dismiss him from office and appoint another in his place.
100. The remuneration of a Managing Director shall from time to time be fixed by the Directors and may be by way of salary or commission or participation in profils or by all or any of these modes.
The minimum amount which in the opinion of the Directors must be ratsed by the present issue in order to provide the sums required to be provided In respect of each of the following matters is:-
(a) The purchase price of the property, nil, the consideration therefor being satisfied in full by the allotment of shares in the Company. (b) Preliminary expenses $25,000.
(c) Working capital $078,000.
The following contracts have been entered into by the Company
1. Dated 14th day of November 1930 and made between James Roxburgh Paton of the one part and Harold John Armstrong on behalf of the Company of the other part being the contract for the sale and purchase of the property hereinbefore mentioned.
2. Dated 20th day of November 1930 made between James Roxburgh Paton of the first part Harold John Armstrong of the second part and the Company of the third port being an Agreement confrming 'the above mentioned Agreement.
Mr. James Roxburgh Paton a Director of the Company is interested in the promotion of the Company as vendor.
Preliminary expenses including fees and stamp duties are to be paid by the Company and are estimated not to exceed $25,000 exclusive of brokerage.
The minimum subscription on which the Directors may proceed to allotment ns-fixed by tho Articles of Association-is-$200,000,-
There are no outstanding mortgages or charges against the Company's assets. Mr. Manning's report, the Crown Lease, Messrs. G. K. Hall Brutton & Co.'s Tetter to Messrs. Deacons of the 22nd September 1938, the above-mentioned agree ments, the Auditors' report and a print of the Memorandum and Articles of Association-of-the-Company-can-be inspected-at-the office of the Company's Sollditors, at any time between the hours of 10 am. and 12 noon and 2.30 p.m. and. 4.30 p.m... on any business day when the subscription list is open.
A brokerage of 5% will be paid on allotments in respect of applications bearing brokers' stamps.
APPLICATIONS:-Applications for shares must be made on the accompanying form and forwarded with the amount payable on application to the Hongkong & Shanghai Banking Corporation, Hongkong or to the Company at its Registered Office. If no allotment is made the amount paid on application will be returned in full and in case a less number of shares is allotted than applied for the excess of such amount will be refunded.
Certificates will be ready for issue in exchange for allotment letters within two months after the date of allotment.
Coples of this prospectus and forms of application can be obtained from the Hongkong & Shanghat Banking Corporation, Hongkong or at the Registered Offer of the Company.
N
Dated at Hong Kong this 30th day of November 1935.
To be returned to the Applicant.
To be returned by the Bankers
This form should be sent entire to the Company's Bankers. The Hongkong & Shanghal Banking
Corporationʻla Hongkap, together with a cheque for the amount payable on application, viz 10 Cents
per share.
Index, No.
HONGKONO MINES, LIMITED.
-Form of Application for Shares to be issued for Cash,
Issue of 15,000,000 shares of TEN CENTS oach to be issued for cash payable in full on application."
To the Directors of
Hongkong Mines Limited, Gentlemen,"
Having paid to the Company's Bankers the sum of $.. being the amount of -19-cents per share on erkegaar .... shares in
the above named Company 'I request you to allot me that number of shares upon the terms of the Company's Prospectus dated the 30th day
of November, 1930 and I hereby agree to accept the same or any smaller number that may be allotted to me; and I authorize you to register me as the holder of the sald shares. Namo in full ...
(Mr., Mrs., Miss or Title)
Address (In full) Occupation
Date
Signoture
N.B.---Chinese Applicants must give in Chinese characters their NAMES,
ADDRESSES and OCCUPATIONS.
Index No.
HONGKONG MINES, LIMITED.
RECEIPT
day of
this
1938, on being the
RECEIVED from
shares of 10 cents each
account of Hongkong Minca Limited, the sum of $. amount of 10 cents per share on of the said 'Company, enpunk
For THE-HONGKONG & BILANGHAI BANKING CORPORATION. This Receipt when returned to the Applicant must be carefully preserved as Share Certificates will not be issued unless this Receipt i surrendered to the Company together with the Allotment Letter, of