MAY 4.] THE NEW ZEALAND GAZETTE. 1287

(2) The holder of any existing securities bearing interest at a rate which, as reduced
in accordance with Part I of the Act, exceeds the rate of interest payable on the new
securities shall on the conversion of such securities be entitled to receive new securities
for the same aggregate amount of principal as is secured by the existing securities, and,
in addition thereto, shall be entitled to receive a premium on such principal computed
in accordance with the Fourth Schedule hereto.
18. (1) Every premium to which any person is entitled under the last preceding
clause shall be satisfied by payment of the amount thereof in cash.
(2) All payments of cash in accordance with the last preceding subclause shall be
made by the local authority out of the balances at the date of conversion standing to
the credit of any of the special-rate accounts of any of the loans referred to in the First
Schedule hereto.

PLACE FOR PAYMENT OF PRINCIPAL AND INTEREST.

19. The principal and interest in respect of new securities shall be payable in New
    Zealand.

CONSOLIDATED SINKING FUND FOR NEW SECURITIES.

20. (1) In order to provide funds for the repayment of the new securities the local
    authority shall forthwith make provision for the creation, pursuant to a resolution of
    the local authority, of a consolidated sinking fund, of which the Public Trustee shall
    be the Commissioner.
    (2) For such purpose the local authority shall permanently appropriate and shall
    pay to the Commissioner of the consolidated sinking fund on each thirty-first day of
    March following the date of conversion up to and including the thirty-first day of March,
    one thousand nine hundred and fifty-six, a contribution of £703, increased in respect of
    each contribution by a sum equal to four per centum of the aggregate amount of
    new securities redeemable up to and including the first day of July preceding the date
    on which such contribution is payable, and reduced by the aggregate of the sums
    which during the twelve months preceding the date of payment of such contribution
    have, pursuant to the provisions of the next succeeding clause, been paid to any
    sinking funds for unconverted securities.
    (3) The provisions of subsections four, five, and six of section ninety-five of the
    Local Bodies’ Loans Act, 1926, shall apply with respect to such sinking fund.

SINKING FUND FOR UNCONVERTED SECURITIES.

21. (1) If dissent is signified in accordance with the provisions of this Order from
    the conversion of any existing securities issued in respect of any loan referred to in the
    First Schedule hereto, the local authority, in order to provide funds for the repayment
    of the unconverted securities issued in respect of such loan, shall forthwith make
    provision for the creation, pursuant to a resolution of the local authority, of a sinking
    fund, of which the persons who at the date of conversion were Sinking Fund Com-
    missioners in respect of such loan shall be the first Commissioners.
    (2) For such purpose the local authority shall permanently appropriate a sum
    which bears the same proportion to the annual contribution payable, before the date
    of conversion, to the existing sinking fund of such loan 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 or part of
    such loan to which this Order applies, and shall pay such sum to the Commissioners
    yearly and every year until the maturity date of such unconverted securities, or until
    the Commissioners are satisfied that the accumulations of sinking fund will suffice to
    redeem such securities at maturity.
    (3) The first of such yearly payments shall be made not later than one year after
    the date on which the last annual contribution payable before the date of conversion
    to the existing sinking fund of such loan was payable.
    (4) Subject to the provisions of this Order, the provisions of sections forty to
    forty-four of the Local Bodies’ Loans Act, 1926, shall, so far as applicable and with
    all necessary modifications, apply with respect to such sinking fund :
    Provided that nothing in the said sections or in this Order shall authorize the
    removal or suspension of the Public Trustee as Commissioner of any sinking fund.

APPLICATION OF EXISTING SINKING FUNDS.

22. (1) The existing sinking fund of every 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 in respect of
    which the sinking fund is held ; 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.
    (2) Where the sinking fund of any loan is, at the date of conversion, held as security
    not only for those existing securities issued in respect of the loan to which this Order
    applies but also for other securities to which this Order does not apply, such sinking
    fund shall be equitably apportioned between those securities to which this Order does
    so apply and those securities to which this Order does not so apply, and the last preceding
    subclause shall in relation to any such sinking fund be construed as applying only to
    the part of the sinking fund so apportioned to the existing securities to which this
    Order applies.

CONSOLIDATED SPECIAL RATE.

23. (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 to provide for the payment of
    interest, sinking fund, and other charges in respect of such securities. Such special
    rate shall be made and levied over the whole of that area of the district of the local
    authority over any part of which any existing special rate in respect of the loans
    specified in the First Schedule hereto was made and levied.