The herald., 1898-12-04
FOR THE MILLION DOLLARS HE
HAS EARNED
SECURED SOME CONCESSIONS
More Valuable Than Any Other Ever
Granted to Foreigners by the
Chinese Government

"Thurlow Weed Barnes has brought suit
in the supreme court against the American
China development company for $l,OO0,OCO
for services in obtaining railroad conces-
sionls from the imperial 'Chlneseg government
through the Chinese minister at Washing
ton. The concessions are worth in net profit
at least $l2, 100000 to the company and they
may be worth $24,0O0,000. They are the
most valuable grants ever made by the Chi
nese government to foreign capitalists and
the terms are more favorable than the con-
cessions obtained in recent yearsby French,
Belgian, English and Russian syndicates.
The chief spirit of the American China
Development company is Calvin 5. Brice.
His associates are James H. Benedict, bank
er; Anthony N. Brady, the Carnegie Steel
and Iron company (Andrew Carnegie), j..
II. Jarvis of the Arbuckle sugar and coffee
corporation, Frederick P. Olcott, president
OF the Central Trust company; W. 4. Reed
of Heremih company, Gen. Samuel Thomas,
railroad owner; Henry X. Wolcott of Col
orado, Richard j. Cross of Morton, Bliss &
Co., Levi p. Morton, Thomas c. Platt, Hen
Try w. Cannon of the Chase National bank,
Thomas F. Ryan, street railway owner,
James r. Stillman of the Standard Oil COM
pany, representing Rockefeller; Moore &
Shipley, bankers; John r. Hegeman of the
metropolitan Life Insurance company,
Clarence Carey, as trustee of II. Mack
! Twombly and various Vanderbilt interests;
Hartley & Graham, arms manufacturers;
). p. Mcdonald, railroad contractor; James
Mcknight, counsel for the Northern Pa
cifc; George R. Sheldon, banker; Charles
| Fl. Coster, c. r. Randall, president of the
Southern Trust company, and many others
Of like prominence in the financial world.
All Of these are defendants in the suit,
as they are co-partners in the syndicate
which controls the concessions.
| Barnes alleges that after Brice's ENJOYS,
including ex-senator William d. Wash
burne of Minnesota, had failed to obtain
the concessions sought, Brice sent for
Barnes and asked him to undertake the
work.
Barnes has spent many years in the Ori-
ent, and had made several friends among
the natives in high power, and moreover,
was friend Of I'm Fang Fang, the Chinese
minister at Washington.
| Mr.. Barnes agreed to do the work, it is
said, on the verbal understanding that he
| would be duly compensated for any valuable
results he might accomplish. He and Clar-
ence Carey were appointed as a committee
to obtain the concessions, Mr.. Barnes being
known as the managing member of the COM
mission. Associated with Thomas +. Bush,
they set to work in January of the present
year. Mr.. Barnes first arranged through
his friends in Picking by cable to have the
Chinese cabinet confer upon WI Ting Fang
: h. epaa;ol 10 ,oly ilpooI
cession he might agree to with the Ameri-
can syndicate. He was successful in this
and negotiations with WI Ting Fang were
begun.
In April an agreement was reached Dur
| ing these months, an immense amount of
correspondence passed between Mr.. Barnes
and the Chinese minister, and between
Barnes and other members of the company,
and also between Barnes and Mr.. Carey
and Mr.. Bush.
These letters and kilograms, it is assert.
ed, will prove that Barnes got the conces-
sions.
| The draft of the agreement reached by
Barnes and the Chinese minister was drawn
up by Barnes and was accepted by both
sides without change, eX-Secretary of State
| John w. Foster acting in an advisory capac-
| ity to the Chinese minister. This agreement
was reached April l3, and was signed the
next day.
Subsequently it was ratified by an imperi-
al edct by the Chinese government. The
concessions obtained by the company pro-
vide for the building of trunk line rail
| road from Hankow south to Canton, dis
tance of about 1000 miles. 1t will run
through the richest and most fertile regions
of China.
The population of that section of China is
200,0OO000. From Hanlsow north to Peking
runs proposed railroad, the concession for
which was obtained by Belgian syndicate.
From Peking northwest runs short road,
owned by China, which will connect with
the great transsibcrian railroad built by
Russia Thus the road permitted by the
American concession will have through con-
nections with the Russian transsiberian
road The most valuable part of the conces-
zion obtained by the Americans is the finan-
cial terms. These have never been pub
| lished.
The road, it is estimated, will cost S40,000,-
600. Bonds for 10 per cent more than the
total cost are to be guaranteed by the i'm
perial Chinese government. The 10 per cent
additional, or $4,000,000, is clear profit to
begin with. The bonds are TO be paid in gold,
to run fifty years and to bear per cent in
terest. The Chinese government also agreed
to pay the American China company per
cent on the total cost of the road for super
intending construction. In addition, the
Chinese government agreed to pI 20 per
cent of the net profits of the road in the
| form Of debenture bonds, bearing per cent
| interest and running forty ythree years. After
paying all expenses of the road, including the
redemption of bonds, the road is to become
| The property of the Chinese government. The
Chinese government has the right to redeem
\ the debenture bonds at par and to give
I rer cent gold bonds at l02A in the first
twenty-five years and at par thereafter.
BY the concessio1.the American company
also obtained the right to mine the rich coal
fields which extend along parts of the route
of the road.
An even more valuable feature of the con-
cesson is that in the event of the contract
with the Belgian syndicate being Cancelled,
The concession to build that road will revert
10 the American China Development com
rary on the same conditions governing the
na,kow Canton road. The members of the
American China Development company got
together and formed what they called the
Chinese Railway syndicate. The Original
subscribers to the project fund each held
1000 shares. They were admitted to the rail
way syndicate by paying $4,000 more on each
share held. the shares of the latter company
costing $4,000. Mr.. Barnes, it is said, had an
understanding thaS his $1,000 shares were te