The undersigned further certifies that on the 15th day of the present month he informed the Imperial Chinese Government by cable that he had, in accordance with its authorization, signed the contract for said railway, with the agent of the American China Development Company of the details of which the undersigned had advised it, and that on the 19th day of the present month the undersigned received a cablegram from His Excellency Sheng, duly empowered, Director-General of Imperial Railways, ratifying the action of the undersigned as follows: "Contract signed. Am glad and grateful. Urge Company to send out agent promptly."

In testimony of the same I sign and seal this 28th day of April, 1898.

WU TING-FANG, [SEAL.] Envoy Extraordinary and Minister Plenipotentiary of China.

Whereas, by an agreement entered into this day, the American China Development Company have agreed to provide a loan for the construction of a railway from the City of Hankow to the City of Canton, China, and

Whereas, coal is one of the necessary articles to be used for working the said railway after its completion, now, therefore, it is hereby resolved that as soon as the said Chinese Railway Company shall have obtained concessions from the Government to open and work coal on territory adjacent to the said railway they will authorize the said American China Development Company and the said American China Development Company undertake to prospect, open and work the said coal, the said American China Development Company undertaking to provide all the funds for the carrying out of this contract. All matters relating to the raising of funds, working of the mines, distribution of profits and other details will be arranged and agreed between the Director-General of the Chinese Railway Company and the American China Development Company.

Witness our hands and seals this 14th day of April, 1898, at the City of Washington, United States of America.

(Sgd.)

WU TING-FANG, [SEAL.]

Chinese Minister to the United States of America.

Witness:

TMUN YEW CHUNG,

Washington, D. C.

AMERICAN CHINA DEVELOPMENT COMPANY,

By (Sgd.) A. W. BASH, Agent. [SEAL.]

Witness:

THURLOW WEED BARNES,

New York City.

MEMORANDUM OF SUPPLEMENTAL AGREEMENT, BETWEEN THE IMPERIAL CHINESE RAILWAY ADMINISTRATION UNDER IMPERIAL SANCTION AND THE AMERICAN CHINA DEVELOPMENT COMPANY OF THE UNITED STATES OF AMERICA FOR THE ACQUISITION OF A LOAN FOR THE

CONSTRUCTION OF A LINE OF RAILWAY FROM HANKOW TO CANTON.

This Supplemental Agreement is made in the 26th year of Kwang Su, Sixth month and seventeenth day, corresponding to thirteenth day of July, 1900, at Washington, and the contracting parties are:

The Director General of the Imperial Chinese Railway Administration Sheng (to be called herein the Director General), acting under authority of an Imperial Decree and the Imperial Chinese Railway Administration (to be called herein the Railway Administration) of the one part; and

The American China Development Company of the United States. of America (to be called herein the American Company), of the other part;

Whereas, the main Agreement was signed at Washington by H. E. Wu Ting-fang, Minister and Envoy Plenipotentiary of the Imperial Chinese Government on the 24th day of the third moon of the 24th year of Kwang Su, corresponding to the 14th day of April, 1898, under the due sanction of an Imperial Decree as transmitted by the telegram of Tsungli Yamen under date of the 12th day of the third moon of the 24th year of Kwang Su, corresponding to the 2nd day of April, 1898, and also signed by A. W. Bash, agent of the American Company in Washington, and subsequently adopted by the said Company on the 22nd day of April, 1898; and,

Whereas, a preliminary survey as provided for in said main agreement has been made and a map showing the results of the same has been presented to and approved by H. E. Sheng; and,

Whereas, the said survey discloses that the work of construction will cost more than originally contemplated; and,

Whereas, a supplemental agreement has thus become necessary to provide for such additional money and for other details;

Now, therefore, for this and other purposes, it is agreed,

ARTICLE 1: It is originally stipulated in Articles 1 and 2 of the Main Agreement that the loan for the Canton-Hankow line is to be for not less than £4,000,000, the same to be calculated in American Gold, but that if this sum is not sufficient, it may be increased and more borrowed.

Imperial Chinese Government Bonds are to be issued for the entire sum similar to the Bonds of recent Chinese loans with the railway as first mortgage security therefor, but without pledging the Customs as guarantee.

Inasmuch as the actual amount of the present loan could be only decided by the estimates of the Engineer-in-Chief made after survey

and now that a preliminary survey has been made and on account of the extensions of the Ping Hsiang and San Shui lines being included in the estimates, as also on account of the unexpected physical difficulties which are now disclosed and which render the work of construction more laborious and expensive than was at first contemplated, it is HEREBY AGREED that the amount of the Gold Bond Loan should be liberally estimated and that a sum of 40,000,000 dollars, American Gold, will be required for building and equipping the Railway.

The American Company is hereby authorized to sell or hypothecate the bonds of such loan from time to time as money is needed for the work or as the money market will allow. But the provisions of the 1st and 2nd Articles of the Main Agreement must be followed in that instalments of so much at one time shall be paid in when interest on the amount so paid in will begin.

The 40,000,000 dollars' loan is to be issued at separate periods and in series not less than four, each series is to be in such amount as the Engineer-in-Chief may determine under direction of the Director General and the American Company in accordance with the extent of the work to be undertaken, so as to prevent the Chinese Government from suffering any undue loss in interest.

ARTICLE 2: The proceeds of this loan are to be used in the construction and equipment of the railway and its appurtenances from the City of Hankow to the City of Canton.

It has been estimated by the Engineer-in-Chief that the distance from Wuchang to Kwangchow with a detour to San Shui is 740 English miles, the branch line of Ping Hsiang 66 miles, the branch line of Yow Chou 25 miles, branch line of Siangtan 9 miles and sidings 78 miles, or a total of 918 miles.

The approximate estimate for the whole work, including materials, rolling-stock and for payment of interest during the several years' time occupied in construction and for contingencies is, altogether 36,538,000 Dollars American Gold. It is therefore AGREED with the American Company to borrow the nominal sum of 40,000,000 dollars. When the work is completed and if there is then a surplus in funds realized from the proceeds of the bonds the said surplus is to be at the disposal of the Chinese Government for use for either redeeming the bonds or being held in deposit in banks for payment to the American Company on account of interest on the Bonds or for the development or business beneficial to the Canton-Hankow Railway, all to be arranged at the proper time between the Director-General and the American Company.

ARTICLE 3: As a firm guarantee for these Bonds issued by the Chinese Government hereunder, the provisions of the Main Agreement that the entire Railway, together with all of its properties, shall be given as a first mortgage security therefor and be carried out in

accordance with the forms of the American law which are customary and usual in such cases. And it is hereby DECLARED that this Supplemental Agreement is to be taken as a mortgage, as is customary in America.

The provisions of this Supplemental Agreement in respect of the mortgage are to be construed and treated as of the same purport and effect as a mortgage customarily executed and delivered in the United States to a Trustee, for the purpose of securing loans to and bond issues upon railway properties.

It is further agreed that if the financial markets in the United States or elsewhere require the execution of another deed of mortgage, for the better protection of the bonds or require the appointment of another Trustee under American law, the American Company shall discuss the matter with the Director General, who will arrange the same as the exigencies of the case may require, the expense of the appointment of another Trustee in such case to be borne by the American Company.

ARTICLE 4: According to Article 1 of the Main Agreement, it is provided that the loan is to be paid in instalments from time to time, as the work shall advance; the first instalment is to be paid as soon as the survey and report of the Engineer-in-Chief of the American Company shall be approved by the Director General and subsequent instalments are to be paid from time to time as money may be needed.

It is hereby agreed that within eight months after this agreement is officially signed and ratified, the American Company shall pay the first instalment to meet requirements for the work, whether the proceeds come from the sale or hypothecation of the Bonds or from advances made, provided the appropriate series of Bonds for the required instalment of such loan shall then have been executed and delivered. If, after the expiration of twelve months from the date of ratification hereof, the work of construction shall not have been begun on the Main line, this Supplemental Agreement is to become null and void.

Of the proceeds realized from the sale of the Bonds after deducting so much of them as may be required to be kept in the United States for the purchase of materials and payments of contracts there, such amounts as may be estimated and certified to by the Engineer-in-Chief to the Board of Commissioners hereafter mentioned as being required for the construction of any particular section of the Main Line or branch lines shall be ordered by the Board of Commissioners after consideration to be transferred to Shanghai to be kept in such bank or banks as may be mutually agreed upon and placed to the credit of the construction account for the exclusive purpose of building such section or sections of the Railways herein provided for under the supervision of the Board of Commissioners.

The accounts of the money spent from time to time in the United States of America and of the money transferred to the credit of the construction and other accounts for use in China are to be submitted to the Board of Commissioners for examination and for report to the Director General for the information of the Tsungli Yamen and for his further report to the Government Bureau of Railways and Mines and the Board of Revenue for record therein.

ARTICLE 5: The date of the Bonds mentioned in the 2nd Article of the Main Agreement and of the Debentures mentioned in the 6th Article of the same Agreement shall be of even date with this Supplemental Agreement. Interest shall begin to run upon the bonds only from the date of their respective sales and deliveries to the public and due adjustment of such interest will then be made with the respective purchasers for any fractional period of time thereafter covered by the coupon next maturing. For the purpose of such adjustment the then current interest may be reckoned from the nearest first or fifteenth day of the month in which the sale and delivery occurs, as the case may be.

Coupons which have therefore matured are to be cancelled and delivered to the Chinese Minister in Washington for transmission to the Railway Administration.

As to the form of the Bond, it is to be agreed upon by the Diretor General or by the Chinese Minister in Washington, and the American Company at the same time as this Supplemental Agreement is signed, but if hereafter the money markets in New York or other countries require the modification of the form of the Bond, except in anything that affects the amount of the Loan, the rate of interest, the period of the Loan and the liability of the Chinese Government, which are not to be touched at all, such modifications may be made to meet the views of the money markets by the American Company in consultation with the Chinese Minister in Washington.

Any such modifications are to be at once reported by the American Company to the Director General for the information of the Tsungli Yamen.

The Bonds and the American debentures are to be engraved entirely in the English language and shall bear the facsimile of the signature of the Director General and of his Seal of Office, in order to dispense with the necessity of signing them all in person, as, owing to the distance being great and the bonds numerous, the transmission of same. is difficult. But the Chinese Minister in Washington is to sign each of the Bonds and Debentures and put his Seal thereon, as a proof that the issue and sale of these Bonds, as well as the Debentures, are duly authorized by, and binding upon, the Chinese Government.

Such Bonds or American Debentures are to be numbered consecutively and as many Bonds or Debentures, whether American or Chinese,