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THE NEW ZEALAND GAZETTE.

[No. 22

23. (1) The sinking fund of the General Extension Purposes 5½ per-cent. 1929 Loan of £25,000 referred to in the First Schedule hereto (of which loan the Public Trustee is holder of some only of the existing securities issued in respect thereof) shall be divided into two parts, the first of which shall bear to the second the same proportion which the amount of the existing securities so held by the Public Trustee bears to the amount of the existing securities held by persons other than the Public Trustee. The said parts shall be applied as follows:—

(2) The first part of such sinking fund shall be applied by the Commissioners thereof as follows:—

(a) First, in transferring to the Commissioners of the sinking fund hereinbefore required to be created for the unconverted securities issued in respect of such loan a sum which bears the same proportion to the amount of such first part of the existing sinking fund at the date of conversion as the aggregate amount of principal secured by such of the unconverted securities as are held by the Public Trustee bears to the aggregate amount of principal secured by all the existing securities issued in respect of such loan and held by the public Trustee;

(b) Secondly, as far as it will extend, to the nearest multiple of one hundred pounds in repayment as at the date of conversion of the principal secured by the existing securities held by the Public Trustee; and

(c) Thirdly, in transferring the balance to the Commissioners of the consolidated sinking fund hereinbefore required to be created for the new securities, to be held as part of that sinking fund:

Interest up to the date of conversion on any existing securities so repaid in accordance with paragraph (b) of this subclause shall be paid by the local authority out of the local fund.

(3) The second part of the said sinking fund shall be applied by the Commissioners thereof in accordance with the provisions of clause twenty-four hereof as if the existing securities issued in respect of the loan and held by persons other than the Public Trustee were a separate loan within the meaning of that clause and such second part of the sinking fund were the sinking fund of such separate loan.

24. The existing sinking fund of every loan or part of a loan referred to in the First Schedule shall be applied by the Commissioners thereof, so far as it will extend, in or towards making the following payments, in the following order of priority, namely:—

(a) First, in transferring to the Commissioners of the sinking fund hereinbefore required to be created for the unconverted securities issued in respect of such loan a sum which bears the same proportion to the amount of such existing sinking fund at the date of conversion as the aggregate amount of principal secured by such unconverted securities bears to the aggregate amount of principal secured by all the existing securities issued in respect of such loan; and

(b) Secondly, in transferring the balance to the Commissioner of the consolidated sinking fund hereinbefore required to be created for the new securities, to be held as part of that sinking fund:

Provided that in the case of each of the loans numbered 9 and 10 in the First Schedule hereto, the Commissioners, in lieu of transferring such balance in accordance with the foregoing paragraph (b) hereof, shall, if so required by the local authority, and on being satisfied that the local authority has, not later than the date of conversion, out of the local fund, redeemed existing securities in respect of such loan to an amount being not less than £5,000 in the case of the said loan numbered 9, and not less than £25,000 in the case of the said loan numbered 10, transfer such balance (together with all accumulations of interest accrued in respect thereof) not later than the sixteenth day of March, one thousand nine hundred and forty-two, to the Commissioners for the time being of the sinking fund established in respect of the Electric-power Extension Loan, 1921, of £500,000, raised by the Auckland City Council: Provided further that nothing herein contained shall be construed as requiring the holder of any existing securities issued in respect of any such loan to accept repayment thereof at or before the date of conversion.

CONSOLIDATED SPECIAL RATE.

25. (1) As a security for the new securities and the unconverted securities the local authority shall forthwith, by resolution gazetted (in the form numbered (4) in the Second Schedule hereto), make and levy a special rate over the whole of the district of the local authority to provide for the payment of interest, sinking fund, and other charges in respect of such securities.

(2) Subject to the provisions of this Order, the provisions of the Local Bodies’ Loans Act, 1926, and of any other Act shall, so far as applicable and with all necessary modifications, apply with respect to such special rate, and with respect to the interest and other charges in respect of such securities, as if such special rate were made and levied in respect of a special loan raised under Part I of the said Local Bodies’ Loans Act, 1926, and as if the local authority were a local authority and its district a district under that Act.

(3) Upon the making of such special rate every special rate theretofore made in respect of any existing securities to which this Order applies shall cease to be a security for such existing securities.

SECURITIES HELD BY TRUSTEES.

26. The provisions of sections twenty-two, twenty-three, and twenty-four of the New Zealand Debt Conversion Act, 1932–33 (relating to the adjustment of premiums as between capital and income and to the powers of trustees and other persons in relation thereto), shall apply with respect to existing securities converted into new securities in accordance with this Order in the same way as they apply with respect to securities converted under that Act, save that the references in the said section twenty-two to the first day of April, one thousand nine hundred and thirty-three, shall be construed as references to the day following the date of conversion.