Inclosure 1 in No. 1.
SHANGHAE-HANGCHOW-NINGPO RAILWAY.
Loan Agreement.
THIS Agreement is made at Peking on the 4th day of the 2nd month of the 34th year of Kuang Hsü, corresponding to the 6th day of March, 1908, and the Contracting Parties are the Wai-wu Pu (Board of Foreign Affairs) and the Yuchuan Pu (Board of Communications), acting under the authority of an Imperial Decree, of the one part, and the British and Chinese Corporation (Limited), hereinafter called "the Corporation," of the other part.
Article 1. The Imperial Government of China authorizes the Corporation to issue a 5 per cent. gold loan for the amount of 1,500,000l. The loan shall be of the date on which it is issued to the public, and shall be called "The Imperial Chinese Government 5 per Cent. Shanghae-Hangchow-Ningpo Railway Loan.”
Art. 2. The loan is designed to provide capital for the construction of a railway line (hereinafter called "the railway") from a point connecting with the Shanghae-Nanking Railway at or near Shanghae in Kiangsu to the cities of Hangchow and Ningpo in Chekiang. The railway shall follow a line from Shanghae through Feng Ching Chen to Kashing-fu, and thence to Hushu and Hangchow, and thence from Chiang Kan to Ningpo, on which line certain construction work has already been locally undertaken under authority of the Imperial Chinese Government.
The survey line shall be open to revision by the Yuchuan Pu.
Art. 3. The Chinese Government guarantees that the capital so provided shall be solely devoted to the construction of the railway, including the purchase of rolling-stock and other equipment, and to the working of the line during construction; it is understood, however, that the cost of the land required for the railway and the payment of interest on the loan during construction are not to be met out of loan funds, but will be paid by the Imperial Chinese Government from other sources. It is understood that the railway will be completed within three years from the date of signature of this Agreement, and that within a period of six months from that date the Corporation shall notify the Yuchuan Pu that the sum of 100,000l. has been placed at their disposal, to be held in Europe or remitted to China as they may direct, as a first instalment on account of the proceeds of the loan. This amount of 100,000l., or whatever portion thereof is actually advanced, together with interest thereon not exceeding a charge of 6 per cent. per annum, shall be deducted from the proceeds of the sale of the bonds.
Art. 4. The rate of interest for the loan shall be 5 per cent. per annum on the nominal principal, and shall be paid to the bondholders half-yearly. The said interest shall be calculated from the date on which the loan is issued to the public, and shall be paid by the Imperial Chinese Government during the time of construction from Chinese sources, and afterwards, in the first place, out of the revenues of the railway, and should these be insufficient, then from the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the east of the Liao River), and thereafter, if necessary, from such other revenues as the Chinese Government may see fit to use for the purpose, in half-yearly instalments, according to the amounts specified in the Schedule attached to this Agreement, and fourteen days before their due dates, Western Calendar, as calculated half-yearly from the date on which the loan is issued to the public.
Art. 5. The term of the loan shall be thirty years. Repayment of principal shall commence after the expiry of ten years from the date of the loan, and, except as provided in Article 6 hereinafter, shall be made by yearly amortization to the Hong Kong and Shanghae Banking Corporation in half-yearly instalments out of the revenues of the railway, and should these be insufficient, then from the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the east of the Liao River), and thereafter, if necessary, from such other revenues as the Imperial Chinese Government may think fit to use for the purpose, according to the amounts specified in the Schedule attached to this Agreement, and fourteen days before their due dates, Western Calendar, as calculated half-yearly from the date on which the loan is issued to the public.
Art. 6. If, at any time after the lapse of ten years from the date of the loan, the Imperial Chinese Government should desire to redeem the whole outstanding amount of the loan, or any portion of it not yet due for repayment in accordance with the Schedule of Repayments hereto attached, it may do so until the twentieth year by payment of a premium of 2½ per cent. on the face-value of the bonds (that is to say, by payment of 102l. 10s. for each 100l. bond), and after the twentieth year without premium; but in each and every case of such extra redemption the Imperial Chinese Government shall give six months' notice in writing to the Corporation, and such redemption shall be effected by additional drawings of bonds, to take place on the date of an ordinary drawing as provided for in the prospectus of the loan.
Art. 7. The Hong Kong and Shanghae Banking Corporation having been appointed by the British and Chinese Corporation (Limited) agents for the service of the loan, the half-yearly payments due for amortization and interest referred to in Articles 4 and 5 shall be made in accordance with the amounts of the Schedule attached to this Agreement, and fourteen days before their due dates as fixed by Articles 4 and 5, to the Hong Kong and Shanghae Banking Corporation by the Yuchuan Pu or its duly appointed representative, who shall hand to the said bank in Shanghae, fourteen days before the said due dates, funds in Shanghae sycee sufficient to meet such payments in sterling in London, exchange for which shall be settled with the bank; the Yuchuan Pu, or its duly appointed representative, having, however, the option of settling exchange with the bank at any date or dates within six months previous to any due date for the repayment of interest and principal. These payments may, however, be made in gold if the Imperial Chinese Government should happen to have gold funds bona fide at their disposal in Europe, not remitted from China for the purpose, and desire so to use them.
In reimbursement of expenses connected with the payment of interest and the repayment of principal of the loan, the Hong Kong and Shanghae Banking Corporation will receive a commission of ¼ 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 be duly paid in full, and should the revenues of the railway, together with the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the east of the Liao River), not be sufficient to provide for the due and full payment of interest and repayment of principal, the Yuchuan Pu 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 bank at the date upon which funds are required to complete full payment of interest and repayment of principal.
Art. 9. The loan is hereby secured upon the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the east of the Liao River), that is to say, that after deducting from the net earnings of that railway the amounts required to meet the payments of interest and repayments of principal due in terms of the Agreement of the 10th October, 1898 (the 25th day, 8th moon, 24th year Kuang Hsü), to the bondholders of the Imperial Chinese Government Loan of that year, then the payment of interest and repayment of principal of the present loan shall be a first charge upon the said surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the east of the Liao River), and no deductions or payments shall be made from the earnings of the said railway other than those required to meet the obligations stated in the Loan Agreement of the 10th October, 1898 (the 25th day, 8th moon, 24th year Kuang Hsü), until an amount sufficient to pay the next half-yearly instalment of interest and principal of the present loan shall have been placed on deposit with the Hong Kong and Shanghae Banking Corporation as security for the due payment of the same.
Art. 10. The Corporation is hereby authorized to issue to subscribers to the loan, bonds for the total amount of the loan for such amounts as may appear advisable to the Corporation. The form of the bonds shall be settled by the Corporation, in consultation with the Yuchuan Pu or its duly authorized representative, or with the Chinese Minister in London. The bonds shall be engraved in Chinese and English; they shall bear the facsimile of the signature of the Yuchuan Pu's duly authorized representative and of his seal of office (in order to dispense with the necessity of his signing them all in person), but the Chinese Minister in London 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 by, and binding upon, the Imperial Chinese Government, and the representative of the Corporation in London shall countersign the bonds as agents for the issue of the loan.
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Inclosure 1 in No. 1.
SHANGHAE-HANGCHOW-NINGPO RAILWAY.
Loan Agreement.
THIS Agreement is made at Peking on the 4th day of the 2nd month of the 34th year of Kuung Hsü, corresponding to the 6th day of March, 1908, and the Contracting Parties are the Wai-wu Pu (Board of Foreign Affairs) and the Yuchuan Pu (Board of Communications), acting under the authority of an Imperial Decree, of the one part, and the British and Chinese Corporation (Limited), hereinafter called
"the Corporation," of the other part.
Article 1. The Imperial Government of China authorizes the Corporation to issue a 5 per cent. gold loan for the amount of 1,500,0001. The loan shall be of the date on which it is issued to the public, and shall be called "The Imperial Chinese Government
per Cent. Shanghae-Hangchow-Ningpo Railway Loan.”
5
Art. 2. The loan is designed to provide capital for the construction of a railway line (hereinafter called "the railway") from a point connecting with the Shanghae-- Nanking Railway at or near Shanghae in Kiangsu to the cities of Hangchow and Ningpo in Chekiang. The railway shall follow a line from Shanghae through Feng Ching Chen to Kabsing-fu, and thence to Hushu and Hangchow, and thence from Chiang Kan to Ningpo, on which line certain construction work has already been locally undertaken under authority of the Imperial Chinese Government.
The survey line shall be open to revision by the Yuchuan Pu.
Art. 3. The Chinese Government guarantees that the capital so provided shall be solely devoted to the construction of the railway, including the purchase of rolling-stock and other equipment, and to the working of the line during construction; it is under- stood, however, that the cost of the land required for the railway and the payment of interest on the loan during construction are not to be met out of loan funds, but will be paid by the Imperial Chinese Government from other sources. It is understood that the railway will be completed within three years from the date of signature of this Agreement, and that within a period of six months from that date the Corporation shall notify the Yuchuan Pu that the sum of 100,0001. has been placed at their disposal, to be held in Europe or remitted to China as they may direct, as a first instalment on account of the proceeds of the loan. This amount of 100,0007., or whatever portion thereof is actually advanced, together with interest thereon not exceeding a charge of 6 per cent, per annum, shall be deducted from the proceeds of the sale of the bonds.
Art. 4. The rate of interest for the loan shall be 5 per cent. per annum on the nominal principal, and shall be paid to the bondholders half-yearly. The said interest shall be calculated from the date on which the loan is issued to the public, and shall be paid by the Imperial Chinese Government during the time of construction from Chinese sources, and afterwards, in the first place, out of the revenues of the railway, and should these be insufficient, then from the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the cast of the Liao River), and thereafter, if necessary, from such other revenues as the Chinese Government may see fit to use for the purpose, in half-yearly instalments, according to the amounts specified in the Schedule attached to this Agreement, and fourteen days before their due dates, Western Calendar, as calculated half-yearly from the date on which the loan is issued to the public.
Art. 5. The term of the loan shall be thirty years. Repayment of principal shall commence after the expiry of ten years from the date of the loan, and, except as provided in Article 6 hereinafter, shall be made by yearly amortization to the long Kong and Shanghae Banking Corporation in half-yearly instalments out of the revenues of the railway, and should these be insufficient, then from the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the cast of the Liao River), and thereafter, if necessary, from such other revenues as the Imperial Chinese Government may think fit to use for the purpose, according to the amounts specified in the Schedule attached to this Agreement, and fourteen days before their due dates, Western Calendar, as calculated half-yearly from the date on which the loan is issued to the public.
Art. 6. If, at any time after the lapse of ten years from the date of the loan, the Imperial Chinese Government should desire to redeem the whole outstanding amount of the loan, or any portion of it not yet due for repayment in accordance with the Schedule of Repayments hereto attached, it may do so until the twentieth year by payment of a premium of 24 per cent. on the face-value of the bonds (that is to say, by payment of 1021. 10s. for each 1001. bond), and after the twentieth year without premium; but in each and every case of such extra redemption the Imperial Chinese Government shall give six months' notice in writing to the Corporation, and such redemption shall be effected by additional drawings of bonds, to take place on the date of an ordinary drawing as provided for in the prospectus of the loan.
Art. 7. The Hong Kong and Shanghae Banking Corporation having been appointed by the British and Chinese Corporation (Limited) agents for the service of the loan, the half-yearly payments due for amortization and interest referred to in Articles 4 and 5 shall be made in accordance with the amounts of the Schedule attached to this Agree- ment, and fourteen days before their due dates as fixed by Articles 4 and 5, to the Hong Kong and Shanghae Banking Corporation by the Yuchuan Pu or its duly appointed representative, who shall band to the said bank in Shanghae, fourteen days before the said due dates, funds in Shanghae sycee sufficient to meet such payments in sterling in London, exchange for which shall be settled with the bank; the Yuchuan Pu, or its duly appointed representative, having, however, the option of settling exchange with the bank at any date or dates within six months previous to any due date for the repayment of interest and principal. These payments may, however, be made in gold if the Imperial Chinese Government should happen to have gold funds bond fide at their disposal in Europe, not remitted from China for the purpose, and desire so to use them.
In reimbursement of expenses connected with the payment of interest and the repayment of principal of the loan, the Hong Kong and Shanghae Banking Corporation will receive a commission of 4 per cent. on the annual loan service.
Art. S. The Tinperial Government of China hereby engages that the interest and principal of this loan shall be duly paid in full, and should the revenues of the railway, together with the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsinmingtun-Mukden line to the east of the Liao River), not be sufficient to provide for the due and full payment of interest and repayment of principal, the Yuchuan Pu 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 bank at the date upon which funds are required to complete full payment of interest and repayment of principal.
Art. 9. The loan is hereby secured upon the surplus earnings of the Imperial Railways of North China (excluding the section of the Hsiumintun-Mukden line to the east of the Liao River), that is to say, that after deducting from the net earnings of that railway the amounts required to meet the payments of interest and repayments of principal due in terms of the Agreement of the 10th October, 1898 (the 25th day, 8th moon, 24th year Kuang Hsü), to the bondholders of the Imperial Chinese Government Loan of that year, then the payment of interest and repayment of principal of the present loan shall be a first charge upon the said surplus carnings of the Imperial Railways of North China (excluding the section of the Hsinmintun-Mukden line to the east of the Liao River), and no deductions or payments shall be made from the earnings of the said railway other than those required to meet the obligations stated in the Loan Agreement of the 10th October, 1898 (the 25th day, 8th moon, 24th year Kuang Hsü), until an amount sufficient to pay the next half-yearly instalment of interest and principal of the present loan shall have been placed on deposit with the Hong Kong and Shanghae Banking Corporation as security for the due payment of
the same.
Art. 10. The Corporation is hereby authorized to issue to subscribers to the loan, bonds for the total amount of the lean for such amounts as may appear advisable to the Corporation. The form of the bonds shall be settled by the Corporation, in consultation with the Yuchuan Pu or its duly authorized representative, or with the Chinese Minister in London. The bonds shall be engraved in Chinese and English; they shall bear the facsimile of the signature of the Yuchuan Pu's duly authorized representative and of his seal of office (in order to dispense with the necessity of his signing them all in person), but the Chinese Minister in London 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 by, and binding upon, the Imperial Chinese Government, and the representative of the Corporation in London shall countersign the bouds as agents for the issue of the loan.
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