410
proposed Agreement in connection with the Construction & working of the Railway at all, but merely an Agreement under which the Corporation are to subscribe, as purchasers, a certain percentage of the shares, debentures and other securities issued by the Company, which are to be made over to them as fully paid. The Company will therefore be encumbered with shares and liabilities representing no asset whatever.
Regarded from this point of view it is not surprising that the promoters are anxious for a Government guarantee to give their shares and debentures some value, whether the line is ever built or not, or whether it ever pays or not.
I am inclined to think that the proposal is rather impudent and that we should insist on considerable alterations at the end of Clause 1, and on the omission of Clause 3.
If the Corporation is prepared to look to the profits of the railway itself and not to the flotation of the company, the question of a guarantee by the Hong Kong Government can be considered. To present many difficulties and will require many safeguards, but, at this stage, it is not worth while to consider these.
1914.
Considering the status of the persons included in this frank bid for promoting profits is surprising.
îL. 1/5.