PUBLIC RECORD OFFICE
Reference :-
TTC.O. 882
6
PUBLIC RECORD OFFICE, LONDON
ALLY WITHOUT PERMISSION OF THE BE REPRODUCED PHOTOGRAPHIC- COPYRIGHT PHOTOGRAPH-NOT TO
500
survey limits, and for the necessary sidings, stations, repairing shops, and car sheds, to be provided for in accordance with the detailed plans now made or hereafter to be made by the Engineer-in-Chief, and approved by the Viceroy shall be acquired by the Viceroy at the actual cost of the land, and shall be paid for out of the proceeds of the loan.
The titles of the land for the railway and all other lands shall be free from all encumbrances and entanglements, and shall, from time to time, as soon as secured, be registered in the name of the railway.
Notices of all purchases of lands for the railway within the survey limit (together with corresponding title deeds) are to be transmitted by the Railway Head Office under the direction of the Viceroy to the local agent of the Corporation for record and preservation in its office in Hong Kong, and for the purpose of establishing the first mortgage security until the time when the same are to be returned to the Viceroy as hereinafter in this article provided.
All lands the title deeds of which are lodged with the Corporation as part of the first mortgage security of the loan shall not be disposed of in any way by hire, lease, or sale to any party for any purpose whatever without the written consent of the Viceroy, except only in the event of the Imperial Chinese Government failing to pay the interest or principal of the bonds, and then in accordance with the powers in the deed of mortgage.
The lands thus bought shall be free from all encumbrances, liabilities, and en- tanglements, and shall be conveyed by full and sufficient deeds of assignment accord- ing to Chinese Law, all of which are to be kept and recorded in the Hong Kong Office of the Corporation, and are to be held by it as a first mortgage security for the bonds under the provisions of this agreement until such time as principal and interest of the bonds, together with all indebtedness, shall have been paid off, when the same shall then be returned to the Viceroy, except only in the case of the Imperial Chinese Government's failure to pay the interest or principal of the bonds and consequent realization under the powers of the mortgage security.
For the proper protection of the first mortgage security, the Chinese Govern- ment undertakes that until the bonds shall have been redeemed, no part of the lands comprised in the mortgage security or the railway with its appurtenances shall be transferred or given to another party, or shall be injured, or that the rights of the first mortgage shall be in any way impaired, unless with the consent in writing of the Corporation, which shall only be given if, in the opinion of the Corporation, the interests of the bondholders will not be affected.
And further, that until the interest and principal of the loan and all indebtedness shall have been paid off, or unless with the express consent in writing of the Corpora- tion, the Chinese Government, or the Viceroy, shall not again mortgage the above properties to another party whether Chinese or foreign.
During the period of this agreement no special taxes shall be levied by the Chinese Government on the railway, its appurtenances, or earnings; but all taxes at present payable, such as land tax, as well as any taxes which the Chinese Govern- ment may hereafter institute, such as stamp duty, &c., and which may be applicable generally to all commercial transactions in China, shall also apply in the case of the railway and its operations.
ARTICLE 8.
It is agreed that if the half-yearly interest on the bonds is not paid on any date thereof, or if the principal of the loan be not paid in accordance with the Amortisation Schedule* hereto attached, the whole railway, with all its appurtenances herein mortgaged to the Corporation for the bondholders, shall be handed over to the Corporation to be dealt with by it according to law in such manner as will ensure the proper protection of the interests of the bondholders provided, however, that if the failure to make payment at one date be due to causes beyond the control of the Chinese Government, and if the Viceroy request the Corporation to postpone the taking over of the railway for a reasonable period of grace, the question shall be amicably discussed and decided between the Viceroy and the agent of the Corpora- tion. When the whole loan and the interest due thereon, and all indebtedness shall have been paid off, the railway, with all its appurtenances in good working condition, shall revert to the possession and management of the Chinese Government according to the provisions of this agreement.
• See page 520.
501
ARTICLE 9.
As remuneration, &c., the Corporation shall receive the sum of £35,000, half of which shall be paid when construction work begins, and the other half upon comple- tion of the line. This amount shall be regarded as a commutation of all commission to which the Corporation and its agents would properly be entitled, and of payment of all services rendered in the construction and equipment of the railway.
By virtue of this payment, the Viceroy is entitled to require the Corporation to superintend the purchase of all materials required for the equipment and construction of the railway, which shall be purchased in the open market at the lowest price obtainable, it being understood that all such materials shall be of good and satis- factory quality. At equal rates and qualities goods of British manufacture shall be given preference over other goods of foreign origin. Invoice and Inspector's Certificates are to be submitted to the Viceroy.
With a view to encouraging Chinese industries, Chinese Government, and other materials are to be preferred provided price and quality are suitable,
No commission shall be allowed to the Corporation on the purchase of materials except as above provided. All trade discounts or rebates, if any, are, during con- struction, to go to the construction account, and after completion to the credit of the railway.
ARTICLE 10.
In the construction of the line, in the working of the railway, and in the perform- ance of the different kinds of business connected with the railway, no interference or obstruction by Chinese or foreigners will be permitted. The Chinese Government will provide protection for the railway while under construction, or when in opera- tion, and all the properties of the railway, as well as all Chinese and foreigners employed thereon, are to enjoy the utmost protection of the local officials.
The railway may maintain a force of Chinese police with Chinese officers, their wages and maintenance to be wholly defrayed as part of the cost of the construction of the railway. In the event of the railway requiring further protection by the military forces of the Imperial or Provincial Government, the same will be duly applied for by the Head Office and promptly afforded, it being understood that such military forces shall be maintained at the expense of the Government or the Province. ARTICLE 11.
All receipts and earnings of the railway shall be regularly paid in to the rail- way's account with the Hong Kong and Shanghai Banking Corporation, and on such funds, whether on daily balance, or on fixed deposit, the Bank's usual rate of interest shall be allowed.
All expenses of working and maintaining the line shall be paid from the receipts and carnings, and any remainder thereof shall be charged with the service of the loan. If, after payment of these expenses, and making due provision for payment of interest at 5 per cent. per annum on the bonds, and for repayments of principal due in accordance with the Amortisation Schedule* hereto attached, there remain surplus funds unappropriated, and properly available for other purposes, such funds shall be at the disposal of the Chinese Government to be used in such manner as the Viceroy may decide, provided always that after completion and opening of the line to traffic the amount sufficient for regular payments of interest and repayment of capital shall le deducted from such surplus funds, if any, and shall be deposited with the Hong Kong and Shanghai Banking Corporation six months before the date at which such payments fall due.
In the event of there being no surplus funds available as aforesaid from the earnings of the railway, the amount required for payments of interest and repayments of principal shall be provided in accordance with the conditions of Article 14 hereinafter.
ARTICLE 12.
The Corporation are hereby appointed trustees for the bondholders, and in any future negotiations respecting these loans or matters arising in connection therewith which may take place between the Viceroy and the Corporation, the Corporation shall be taken as representing the bondholders, and as empowered to act on their behalf. As remuneration for its services and responsibility in thus acting as trustees, the Corporation shall receive the sum of £1,000 per annum, such remuneration to
• See page 520.