A.—4

84

lll.—Trading Companies.

Heads of an Agreement between the Government of New Zealand, of the ono part, and Frederick Whitakek, on behalf of himself and the several other Persons hereafter to bo named (and herein called the Promoters), of the other part. 1. The promoters undertake to form a joint-stock company, to be called " The New Zealand and Polynesian Company," for the objects hereinafter mentioned. 2. The capital of the Company to bo £1,000,000, divided into 100,000 shares of £10 each, with power to increase the capital and borrow £1,000,000. 3. The liability of the shareholders to be limited. 4. The head-quarters of the Company to be at Auckland, an<§; Directors resident in other parts ot the colony to act as Local Boards at such places as the business of fcKfl Company may from time to time require. A meeting of all the Colonial Directors to be held once a year, in Wellington. A Board of Directors shall also be constituted in London. 5. The objects of tho Company to )>r - (1.) To carry on the business of merchants, shipowners, planters, producers, manufacturers, brokers, agents, insurers, bankers, and money-lenders, in the islands of the Pacific, New Zealand, and Great Britain, and also elsewhere with the permission of tho Government of New Zealand. 6. New Zealand to bo made by the Company the depot for the island trade ; and specially the Company— (1.,) To bring to New Zealand all the produce it exports from the islands, to be manufactured in or exported from New Zealand, unless permitted otherwise to deal with it by the Government. (2.) To ship from New Zealand all the merchandise and supplies imported by tho Company into the islands, unless otherwise authorized by the Government. (3.) To employ at least six steam-vessels to carry on tho trade between New Zealand and the islands, and between the several islands ; the steam-vessels running from the islands to New Zealand to call at Auckland, Manukau, Napier, Taranaki, Nelson, Wellington, Lyttelton, and Port Chalmers, as may from time to time be required by the Government, having due regard to tho requirements of trade and the interests of tho Company. (4.) To establish manufactories in Now Zealand to utilize the products of tho islands, and to prepare supplies and merchandise for export to the islai Is. (5.) To establish within five years such a manufactory in Otago, Canterbury, Wellington, and Auckland, in the order those several places are named. ~ 7. In consideration of the foregoing, the Government of New Zealand will guarantee interest after the rate of £5 per centum per annum on the paid-up capital of tho Company, not exceeding £1,000,000, for fifty years, and will provide for the regular payment of such interest half-yearly, irrespective of the state of tho accounts between the Government and the Company, and notwithstanding the Government and General Assembly may exercise the powers hereinafter provided for. 8. Such interest and all sums paid by the Government in respect of tho guarantee shall bo a first charge on tho profits of the Company, and no dividends shall be paid by the Company until all sums advanced by the Government have been repaid. 9. If at any time tho business of the Company is not carried on, in the opinion of tho Governor in Council, with sufficient vigour or prudence, or in accordance with the intentions of this agreement—or if at any time after the expiration of throe years there shall be due by the Company to the Government, in respect of the guarantee, a sum exceeding £100,000 —it shall be lawful for the Government to suspend the powers and functions of tho Company and of the Directors, by notice to be published in tho New Zealand Gazette. 10. In such case, the business of the Company shall, .until the General Assembly shall otherwise provide, be managed by a Commissioner, to be appointed by the Government, who shall have and may exercise all tho functions and powers vested in the Directors ; and 11. It shall be lawful for the General Assembly to deal with the Company and its business and property in such manner as the General Assembly may think fit: Provided that nothing be done to prejudice the payment of the guaranteed interest, which, under any event, shall bo duly and punctually paid by tho Government at the times and for the term herein mentioned: Provided also, that any Bill affecting tho powers, functions, or interests of the Company shall be reserved for the signification of Her Majesty's pleasure thereon. 12. There shall be two Managing Directors, one in Now Zealand and one in England, and those officers shall bo appointed and may be removed by tho Government. 13. The amount of salary of each Managing Director shall bo fixed by tho Government, but shall not exceed £1,800 per annum for the first year, with an annual increase of £100, till a maximum of £2,500 is reached. Such salaries to be paid by the Company. 14. The especial duty of the Managing Directors shall be to see that the agreement with the Government is faithfully carried out; to report all matters to the Government which they may deem of sufficient importance ; and to furnish from the Company's books, and otherwise, all such information as tho Government may from time to time require; and no business or plantation shall be purchased without the consent of the Managing Director in New Zealand. 15. Subject to the foregoing, tho Managing Directors to carry out the instructions of the Company. 16. The Directors, general and local, to bo paid a reasonable remuneration for their services. 17. The Promoters shall not receive any promotion-money, or shares. 18. The agreement, to be drawn up in accordance with these heads, to be submitted to the General Assembly for ratification, and to be of no force until such ratification is obtained. If it be refused, suoh refusal to form no ground for compensation on any account whatever.

GEEMAN MAEITIME TEADING COMPANY. No. 1. The Agent-Geneeal to the Pbemiee. Sib, — 7, Westminster Chambers, London, S.W., 27th January, 1880. I enclose to you the translation of a German prospectus for the establishment of a company likely to exercise great influence in the future throughout the South Pacific. The primary object of the Company is to take over the assets of the Company formed by Messrs. Godefroi: but, inasmuch as its capital is to be largely in excess of what is sufficient i'or that purpose, with an almost indefinite power of increase, its objects are presumably of a much more ambitious description than those of the Company it supersedes. Its title is a very wide one —"The German Maritime Trading Company;" and its object is stated to be " transatlantic trade ; the purchase and working of factories, mills, and plantations, particularly in the South Sea Islands." Prince Bismarck considers the Company fo have an importance of so high a national .character, that he has undertaken to procure for it a guaranteed minimum rate of dividend to the shareholders. It will be in your recollection that, in 1874, I strongly urged the expediency of New Zealand encouraging by a guarantee a similar company. I greatly regret that the proposal did not meet