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For and on behalf of the Banque de l'Indo-Chine,
ULLMANN. ST. SIMON.
For and on behalf of the Deutsch-Chinesische Eisenbahn-
Gesellschaft m.b.H.,
(2.)
FR. URBIG. REHDERS.
MEMORANDUM of agreement made the 6th day of July, 1909, between the Houg Kong and Shanghac Banking Corporation, having its office at 31, Lombard Street, in the city of London (hereinafter called "the Hong Kong bank "), of the first part; the Deutsch-Asiatische Bank, having its office at 14 to 16, Behrenstrasse, Berlin (here- inafter called "the German bank "), of the second part; and the Banque de l'Indo- Chine, having its offices at 15 bis Rue Laffitte, Paris (hereinafter called “the French bank "), of the third part;
Whereas by agreement entered into on the 27th July, 1895, and extended by a further agreement on the 4th October, 1905, the Hong Kong bank and the German bank entered into agreements for providing for participation in loans and advances arranged with the Chinese Government or with the provinces of the Chinese Empire on the terms therein mentioned;
And whereas the French bank has asked that it may be admitted to an equal participation in the agreement between the Hong Kong bank and the German bank, and the Hong Kong bank and the German bank are prepared to admit the French bank into an equal participation therein.
Now it is hereby agreed by and between the parties hereto as follows:-
1. In the matter of this agreement the German bank is acting on behalf of the German syndicate for Chinese business consisting of the parties whose names are set forth in the first schedule hereto and the French bank is acting on behalf of the French syndicate for Chinese business consisting of the parties whose names are set forth in the second schedule hereto. The French bank and the German bank reserve to themselves the right of increasing or reducing in each special case the number of parties interested in the French and German syndicates respectively, and a similar right is reserved to the Hong Kong bank, but so that in any such case any party dropping out in any special case shall still remain bound by the restrictive provisions hereof, and any party coming in in any special case shall become subject to the restrictive provisions hereof.
2. The agreement of the 27th July, 1895, as modified by the agreement of the 4th October, 1905, is as from the date of this agreement annulled and the provisions of the present agreement are substituted for it.
3. This present agreement relates to all loans and advances which may be concluded with the Chinese Imperial Government or with any of the provinces forming part of the Chinese Empire and [or] with Government departments and companies having Chinese Imperial or provincial Government guarantees.
4. Any business of the kind hereinbefore defined which may be offered to either of the contracting parties hereinafter referred to as the lenders, must be dealt with jointly by them in accordance with the stipulations of this agreement.
5. As regards joint action in respect of financial operations with railway or other companies, not having such guarantees, the provisions of this agreement do not apply, and special agreements must be made in each separate case where they are to be treated as joint business. Current banking business as well as small financial operations coming within the scope of the same do not fall within this present agreement.
6. This agreement is made on the principle of equality, namely, equal terms in every respect between the lenders, and each of the lenders enters into this agreement for their respective groups, and shall take an equal share in all operations and jointly sign all contracts except as hereinafter provided, and shall bear in equal shares all charges in connection with any business (except stamp duties, and any charges of, and connected with the realisation by each of the lenders in their respective markets of their partici-
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pation in the operations) and conclude all contracts with equal rights and obligations as between themselves; provided always that in cases where the introduction of third parties is calculated to prejudice the success of the negotiations any business falling within the scope of this agreement may be entertained and negotiations entered upon by either of the lenders alone with or without notice to the other lenders, and should it appear in the course of such negotiations that the conditions imposed upon the business preclude joint negotiations and [or] joint signatures by the lenders in terms of this agreement, the negotiating party may conclude the negotiations and sign the agreement alone but upon the terms of the other lenders being entitled to all rights or participation under this agreement other than those involving or arising from joint negotiation and joint signature, but it is understood that all the lenders will use their best endeavours to obtain the joint signatures to any contract wherever possible, except where for any reasons this is found to be impracticable, when the party signing the contract shall by the insertion of a special clause or execution of a separate declaration of trust or otherwise, ensure to the other lenders the same rights as regards the taking over the issue and service of the loan which it has obtained under the contract for itself, and also the authority required for obtaining official quotations in the respective markets of the said other parties.
7. All contracts shall so far as possible be made so as not to impose joint liability on the lenders, but each of the parties to the said contracts shall severally liquidate its own engagements and liabilities towards the party of the other side in China. The parties to the said contracts will so far as possible come to an understanding with regard to the realisation of the operations, but so that such realisation in whatever manner this may take place shall be for the separate benefit of each of the lenders as regards their respective participations therein.
8. In the event of either of the lenders declining a participation in any business proposed either at the outset or at any time during the course of the negotiations, the other lenders shall have the option of taking up and carrying out the business either jointly or if only one takes up the business separately on their or its respective accounts without prejudice to the provisions of this agreement.
9. The lenders will endeavour to secure in their respective markets a successful issue of any loan the subject-matter of contracts entered into with them jointly or in which they may be jointly interested.
10. Any participation given in its own market by any one of the lenders shall be for its own account only, but any participations given by and in the mutual interest of all the lenders who may be parties to or interested in any contract to any banks or banking firms outside of England, France, and Germany, respectively, shall be borne in equal shares by the parties interested.
11. On the issue for subscription to the public of any loan in which the lenders or any of them may be jointly interested the respective branches of the Hong Kong bank, the German bank and the French bank, situate within the territory of the market of the other lenders respectively, shall receive subscriptions and otherwise act in the matter of the loan on behalf of that one of the lenders within the range of whose market the branch is situate upon the same conditions as are decided upon for the other houses or branches receiving subscriptions in such market.
12. The three parties hereto are willing to enter into an agreement for the purpose of fostering their mutual interests in Asia outside all loan and advance business, and to enter into negotiations for that purpose, and they hereby agree that no loans in China shall be concluded either directly or indirectly by either of the parties hereto, or by any of those whom they respectively represent without the consent of the others except in the special cases nientioned in paragraph 6 hereof,
13. Save as herein provided and as provided in an agreement between the British and Chinese Corporation (Limited), Chinese Central Railways (Limited), the Banque de l'Indo-Chine, and the Deutsch-Chineische Eisenbahn-Gesellschaft m.b.II. entered into immediately before this agreement no business of the kind falling within the scope of this agreement shall be concluded or entered into, either directly or indirectly, by any of the parties hereto, or by any of those whom they respectively represent without the consent of the others.
14. The present agreement shall remain in force until the 31st December, 1912, and unless determined on that day by twelve months' previous notice given by any one of the lenders to the others then until six months' notice shall be given by any one of the lenders, such notice to expire on the 30th June or 31st December in any year. Notwithstanding the termination of this agreement all contracts made hereunder shall continue in force for their due fulfilment until completely carried out.
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