:
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of the revenue of the line named or such other revenue as the Chinese Government may think fit to use for the purpose in half-yearly instalments, according to the amounts and dates of the Schedule attached to this Agreement.
Art. 5. The term of the loan shall be thirty years. Repayment of principal shall commence in the eleventh year from the date of the loan, and shall be made by a yearly sinking fund to the Syndicate banks in yearly instalments out of the revenue of the line or such other revenue as the Chinese Government may think fit to use for the purpose, according to the amounts and dates of the schedule attached to this Agreement.
Art. 6. In the event of the Imperial Chinese Government wishing to redeem after the lapse of fifteen (ten) years from the date of the loan the outstanding amount, or any portion of it, not yet due, it may, on giving six months' notice, do so by paying 24 per cent. premium, but if after the lapse of twenty-five (twenty) years from the date of the loan, it may do so free of premium.
Art. 7. After the line has been completed, the yearly payments due for amortization and the half-yearly payments due for interest-except as otherwise provided in Article 4-shall be made in accordance with the amounts and dates of the schedule attached to this Agreement out of the net revenue of the railway line, or such other revenue as the Chinese Government may think fit to use for the purpose, to the Syndicate banks by the Director-General, who shall hand to the banks in Shanghae or in Tien-tsin fourteen days before the due dates named in the schedule funds in Shanghae or Tien-tsin sycee sufficient to meet such payments in sterling in Europe, the rate of exchange for which shall be settled with the banks at the best procurable market rate. These payments may, however, be made in Europe on the date due if the Imperial Chinese Government should have funds in Europe and desire so to use them.
In reimbursement of expenses connected with the service of interest and principal of the loan the Syndicate banks will receive a commission of 1 per cent. on the annual loan service.
Art. 8. The Imperial Government of China hereby engages that the interest and principal of this loan shall duly be paid in full, and should the revenues of the railway not be sufficient to provide for the due and full payment of interest and repayment of principal of this loan, the Director-General shall memorialize the Throne, and the Imperial Government of China will thereupon make arrangements to insure that the amount of deficiency shall be met from other sources and handed over to the bauks fourteen days before the due date of the funds required to complete full payment of interest and repayment of principal.
Art. 9. The loan is hereby secured--
:
(1.) By the
tacls a-year;
(2.) By the
taels a-year; and
(3.) By the
revenues of Chihli Province, estimated at
revenues of Shantung Province, estimated at
revenues of Kiangsu Province, estimated at
Haikwan
Haikwan
Haikwan
taels a-year.
The
revenues of the three provinces above enumerated are hereby declared to be free from all other loans, charges, or mortgages.
So long as principal and interest of the loan are regularly paid, there shall be no interference with these provincial revenues; but if principal or interest of the loan are iu default at due date, the said
revenues must then forthwith be handed over
to the Imperial Maritime Customs to administer. So long as this loan or any part thereof shall be unredeemed, it shall have priority both as regards principal and interest over all future loans, charges, and mortgages charged on the said security of the revenues of the three provinces. No loan, charge, or mortgage shall be raised or created which shall take precedence of, or be on equality with, this loan, or which shall in any manner lessen or impair its security over the said
revenues of the three provinces as stipulated above; and any future loan, charge, or mortgage charged on the said
revenues of the three provinces shall be made subject to this loan, and it shall be so expressed in every Agreement for every such future loan, charge, or mortgage.
In the event of the Chinese Government, during the currency of this loan, entering upon definite arrangements for the revision of Customs Tariff accompanied by stipulations for decrease or abolition of li-kin (?), it is hereby agreed, on the one hand, that such revision shall not be barred by the fact that this loan is secured by li-kin (F) revenues,
and, on the other hand, that whatever li-kin is pledged for the security of this loan shall neither be decreased nor abolished except by previous arrangement with the banks, and then only in so far as an equivalent is substituted for it in the shape of a first charge upon the increase of customs revenue consequent upon such revision.
Art. 10. The Syndicate will be authorized to issue to the subscribers to the loan bonds for the total amount of the loan in pounds sterling in such form, in such languages, and for such amounts as shall appear advisable to the Syndicate banks. The form of such honds shall be settled in consultation between the Director-General and the Syndicate. The bonds shall be engraved in English or German as may be required, and the Chinese text shall also be printed thereon. They shall bear the facsimile of the signature of the Director-General and of his seal of office, in order to dispense with the necessity of siguing them all in person. But the Chinese Minister in London or Berlin, as the case may be, shall, previous to the issue of any bonds, put his seal upon each bond with a facsimile of his signature, as a proof that the issue and sale of the bonds are duly authorized and binding upon the Chinese Government.
In the events of bonds issued for this loan being lost, stolen, or destroyed, the Syndicate banks shall immediately notify the Director-General or the Chinese Minister in Berlin or London, as the case requires, who shall authorize the banks to insert an advertisement in the public newspapers notifying that payment of the same has been stopped and to take such other steps as may appear advisable or necessary according to the laws and the customs of the country. Should such bonds not be recovered after a lapse of time to be fixed by the Syndicate banks, the Director-General or the Chinese Minister in Berlin or London, as the case may be, shall seal and execute duplicate bonds for a little amount and hand them to the banks, by whom all expenses in connection therewith shall be defrayed.
Art. 11. All bonds and coupons and payments made and received in connection with the service of this loan shall be exempt from all Chinese taxes and imposts during the currency of this loan. Interest coupons not presented for payment within five years and drawn bonds not presented within thirty years after they are due will become worthless. Art. 12. All details necessary for the prospectus and connected with the service of the interest and repayment of the principal of this loan, not explicitly provided for, shall be left to the arrangement of the Syndicate banks in conjunction with the Director-General or with the Chinese Ministers in Berlin or London, as the case may he. The Syndicate will be authorized to issue a prospectus of the loan as soon as possible after the signing of the present Agreement.
The Imperial Government of China will instruct the Chinese Ministers in Berlin and London to co-operate with the Syndicate in any matters requiring conjoint action and to sign the prospectus of the loan.
Art. 13. The loan shall be issued to the public in two or more services of bonds, the first issue to be made to the amount of 3,000,0001. as soon as possible after signature of this Agreement and not later than nine months from the date thereof. The price of the first series of bonds shall be per cent. of their nominal value to the Chinese Government. The second and any subsequent series shall be issued in time to permit of uninterrupted continuance of the work of construction in amounts to be determined by the Director-General, the last issue being limited to the actual amount required for the construction and equipment of the railway. The price of the second and any subsequent series shall be determined at the time of issue, with duc recognition for the then existing conditions of the money market, it being understood that the price payable to the Chinese Government in respect to the second and any subsequent series shall be the actual rate of its issue to the public less a flotation commission of 5 per cent. retainable by the Syndicate banks. Subscriptions will be invited by the Syndicate in Europe and in China both from Europeans and Chinese on equal conditions, preference being given to the application of the Chinese Government,
Art. 14. The proceeds of the loan shall be paid to the credit of a Tien-tsin- Yang-tsze Government Railway account with the Syndicate banks in China, London, or Berlin, as the case may be. The payment into the credit of this account shall be made in instalments, and on dates conforming to the conditions allowed to the subscribers to the loan. Interest at the rate of 4 per cent, shall be granted on the daily credit balance of the portion of this railway account kept in London and Berlin. The rate of interest to be granted on the daily credit balance of the portion of this railway account kept in China will be left to special arrangements to be made from time to time, according to the condition of the market. After deduction of the funds required for the service of interest, and for commission on this service during the time of construction,
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