TNAG-0097-FCO40-133-Construction-of-a-Cross-Harbour-Tunnel-1968 — Page 128

CONFIDENTIAL

4.

7. E.C.G.D. will require to be satisfied as to the terms of the loan agreement and the supply contract. This is implicit in H.M.G's undertaking

to share in the quarantee on a commercial contract otherwise acceptable to 3.C.G.D. The points mainly concorn the adequacy of provisions for termination of contract, arbitration in case of dispute, adoquato dofinition of responsibilities and amounts involved, and the interlocking or compatibility

of the two contracts.

8.

Additionally, H.M.G. will wish to be satisfied that the torms are not

so onorcus to the supplior as to be incapable of fulfilment or which could only be fulfilled at considerablo hardship. As guarantors H.M.G. and tho Government of Hong Kong have the samo interest in this rogard noither wish to forco the contractor into bankruptcy during construction. As sharoholders tho Hong Kong Government hovo slightly different interests and H.M.G. hope that in the former capacity the Government of Hong Kong will use their influence with the shareholders to socuro reasonable torms.

Jefintion of Earnings

in

W be miel

Anderstandings.

CONFIDENTIAL