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Loan; but in the event of any branch lines being decided upon by the Chinese Government for construction in connection with this Railway, and if the Chinese Government decide to build the same by issue of a foreigu Loan and not from its own resources, then the Corporation shall have the first option of tendering for such Loan, and a further payment, proportionate to the amount of such supplementary Loan, and calculated at the same rate as the commutation hereinabove mentioned, shall be made to the Corporation as commutation of its commission for all services in respect of construction.
In return for this commated commission, the Viceroy is entitled to require the Corporation to superintend the purchase of all materials required for the construction and equipment of the Railway, which shall be purchased in the open market at the lowest rate obtainable, it being understood that all such materials shall be of good and satisfactory quality. At equal rates and qualities, goods of British manufacture shall be given preference over other goods of foreign origin. Invoices 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 construction, 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 performance 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 operation, and all the properties of the Railway, as well as Chinese and foreigners employed thereon, are to enjoy the atnost protection from 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 and maintenance of the Railway. In the event of the Railway requiring further protection by the military forces of the Imperial or Provincial Governments, 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 Govern- ment or the Province.
Article 11.
All receipts and earnings of the Railway shall be regularly paid in to the Railway's account with the Tiongkong 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 earnings, and any remainder thereof shall be charged with the service of the Loan. If, after payment of these expenses, and making due provision for payinent of interest at 5% 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 repayments of principal shall be deducted from such surplus funds, if any, and shall be deposited with the Hongkong and Shanghai Banking Corporation six months before the date at which such payments fall duc.
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 Bond-holders, 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 Bond-holders, and as such, empowered to act on their beball. In view of the fact that the Corporation's responsibility to the Bond-holders continues after construction, whereas, as stared in Article 9, its commuted commission for services rendered is limited to the period of construction, and the Corporation not thereunder
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