ARTICLE 4. The duration of the present concession shall be ninetynine years, counting from the day upon which the canal shall be opened to universal traffic.

During the same period the association shall have the right to construct and to operate with, in the territory of Costa Rica, a railway along the canal, in its full length or such parts of it as may be deemed requisite for the better service and operation of the work.

The Republic binds itself not to grant any subsequent concession to open a canal between the two oceans during the term of this concession. During the same period it will not grant concessions for railways from sea to sea, within a zone of 25 miles along a line of the canal, which might enter into competition with the canal in the traffic between foreign nations. This restriction shall not prevent the construction of new railway lines which Costa Rica may find it convenient to build up to the canal or to any other point of the northern frontier of the Republic, either to connect or not with other railways.

ARTICLE 5. The asssociation shall have the right to construct such telegraph lines as may be deemed necessary for the construction, management, and operation of the canal.

The Government may use the telegraph lines of the association from and to each one of the stations on the line from sea to sea without any remuneration therefor to the association.

ARTICLE 6. The Government of the Republic declares and accepts as such, during the terms of this concession, the ports at each terminus of the canal and the canal itself from sea to sea to be neutral; and that consequently, in case of war between other nations or between one or more of the latter and Costa Rica, the transit through the canal shall not for such cause be interrupted, and that merchant vessels and persons of all nationalities of the world may freely enter said ports and pass through the canal without molestation or detention.

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In general, all vessels may pass freely through the canal without distinction, exclusion, or preference as to persons or nationalities upon the payment of the dues and the observance of the regulations established by the association for the use of said canal and its dependencies. regard to the transit of foreign troops and vessels of war, the conditions established or which may hereafter be established by treaties between Costa Rica and other nations, or by international law, shall be respected, but the entrance of the canal shall be rigorously prohibited to vessels of war of any nation which may be at war with Costa Rica or with any other of the Republics of Central America.

Costa Rica will endeavor to obtain from the nations which guarantee the neutrality of the canal that in the treaties entered into for that purpose they will bind themselves to guarantee the same neutral character to a free zone parallel to the canal and a maritime zone on both oceans, the extent of which shall be fixed in the respective conventions. ARTICLE 7. The present concession shall be transferable only to the company or companies organized with the object of constructing and operating the canal, and in no case to any foreign government or public power. Nor shall the association have the right to transfer to any foreign government or public power any part of the lands granted to it by this contract. But it shall have the right to make such transfers to private parties under the same restrictions.

The Republic of Costa Rica shall not cede its rights and privileges respecting the canal to any foreign government or public power.

All nations shall be invited to take part in forming the capital required for this enterprise, and with that object the publication of a

notice for twenty consecutive days in one of the principal daily newspapers of each of the cities of New York, London, and Paris shall be sufficient.

ARTICLE 8. The capital stock of the company definitively organized for the operation of the canal shall consist of shares of the nominal value of $100 each, which shall be issued in such amounts as may be deemed requisite. The emission and transfer of these shares and of all the bonds and obligations which the company may issue shall be exempt from stamp and any other import established, or that may be established, in the Republic.

From the capital stock with which the company shall be organized, at least 5 per cent shall be reserved for the Government and citizens of Central America who may wish to subscribe.

As soon as the said company is ready to open subscription books, notice shall be given by it to the Governments of Costa Rica and Nicaragua, which shall invite the other Governments of Central America and through them private parties to subscribe.

The shares which within six months from the date upon which notice has been given to the Government of the opening of the subscription books shall not have been paid for shall remain at the free disposal of the company.

ARTICLE 9. The company shall be organized in the form and with the conditions usually adopted for associations of this class. Its principal office shall be established in New York, or wherever it may be deemed most convenient. The half, at least, of the first board of directors shall be selected from among the members of the Nicaragua Canal Association, of which they were the founders.

ARTICLE 10. The Government of Costa Rica, in its character of stockholder in the permanent company, as hereinafter stipulated, shall have the perpetual right to name one director, who shall be one of the board of directors of the company, with all the rights, privileges, and advantages which the charter, statutes, and by-laws and the laws of the nation under which it is organized confer upon the other directors. The Government shall also have the right in its character of stockholder to take a part in the elections of the company.

ARTICLE 11. The permanent company shall be bound to maintain a representative in Costa Rica invested with ample powers for all that may be of active or passive interest to the enterprise.

ARTICLE 12. The association shall have the most ample liberty to select and adopt the route which may be deemed the most suitable, advantageous, and economical between the two oceans for the excava tion, construction, and operation of the canal and its dependencies and ports, whether such route shall pass wholly or in part through Costa Rican territory or only alongside of it.

If the canal shall deviate from the San Juan River in the section over which Costa Rica has the right of navigation the Government of Costa Rica reserves the right to require the association to establish at places which the engineers of the association shall consider suitable a communication between the uncanalized part of the San Juan and the dividing level of the canal by means of a lock or locks sufficient for the navigation of vessels of 6 feet draft. It is understood that this obligation in no way binds the association to place or to keep in a navigable condition the lower part of the river, for the communication of which with the canal the locks are to be employed.

ARTICLE 13. All the expenses for surveys, construction, preservation, and operation of the canal shall be paid by the association, with

out any subvention in money or guaranty of interests on the part of the Republic.

ARTICLE 14. The association shall construct and maintain in good condition two large ports to serve as the termini of the canal on the Atlantic and on the Pacific at the places the association shall select, within or without the territory of Costa Rica. Each port shall have a light-house of the first order.

ARTICLE 15. All the area, whether within the territory of Costa Rica or in the ports, roadsteads, or rivers of the two oceans, necessary for the construction of the canal, its slopes, and declivities; for the area occupied by the waters overflowing from the dams to be built on the beds of the rivers; for the indispensable deviations of streams which may have to be made, as also for the reservoirs, dikes, spaces around the locks, stations, light-houses, warehouses, buildings, shops, and depots for materials; for the routes, railways, and canals for construction service; for the transportation of all materials to the line of work, and for feeders of the canal; in short, all the lands and places within the territory of Costa Rica necessary for the construction and operation of the canal according to the tracings and plans as laid down by the engineers of the association shall be placed by the State at the disposal of the association under the conditions established in the following articles.

ARTICLE 16. Public lands belonging to the State shall be given to the association without any indemnity; and as regards private property, the State will undertake its expropriation should the association ask it. The indemnity to which it may give rise, in conformity with the laws of Costa Rica, shall be paid by the association, together with the amount of costs and expenses, so that the national treasury shall incur no expense.

ARTICLE 17. In all expropriations made in accordance with the foregoing article, the State shall assure to the association enjoyment of the same immunity and privileges. that the legislation of the country accords to it; so that the association shall not be obliged to pay more than the State would have to pay under analogous circumstances.

ARTICLE 18. The association shall have the right to take gratuitously from the lands belonging to the State, for the construction, preservation, and operating of the canal, any material found thereon, especially woods for construction and for fuel, lime, stone, clay for bricks, and earth for the gradings that may have to be made.

In regard to the same materials, before mentioned, existing on private lands, the associations shall enjoy the same rights and privileges which by law the State enjoys.

ARTICLE 19. In case the association should find it necessary to occupy, temporarily or during the construction of the canal lands not comprised in those designated in articles 15, 16, and 18, it shall not be required to pay anything therefor if they are public lands, and the State shall not sell or dispose of them in any way, should the association determine to hold them, without reserving this right to the association, the limit whereof shall be the completion of the Interoceanic Canal. If the lands should belong to private individuals, the association shall enjoy as regards their temporary occupation all the rights and privileges that the laws concede to the State, and may enter into immediate possession after the declaration of utility and necessity, and of the indemnity therefor, which shall not exceed that which the State would in such case be bound to pay.

ARTICLE 20. The Republic of Costa Rica being anxious to aid the

association efficiently in this enterprise cedes to it in fee simple the public lands hereinafter mentioned in alternate lots, reserving others of equal dimensions, to wit:

First. On the right or south bank of the San Juan River to 3 miles beyond "Castillo Viejo" (English miles are understood) to the point of its confluence with the San Carlos, should the canal follow the basin of the San Juan, lots of 3 miles frontage on the canal and of 3 English miles wide by 6 miles in depth.

Second. Between the River San Carlos and the Atlantic, should the canal pass wholly or in part through Costa Rican territory, or in the line of the Costa Rica frontier, lots of 3 English miles in width fronting the canal and 4 in depth.

Third. In case the route by way of the Bay of Salinas should be adopted, lots of 2 miles in width fronting the canal and 2 in depth, in the Costa Rican territory which the canal crosses or along which it runs, from the Pacific Ocean to a point distant 2 English miles from the mouth of the Sapoa River on Lake Nicaragua.

Fourth. In case the canal should deviate from the San Juan River more than 4 miles upon the territory of Costa Rica, lots of 2 miles in width by 2 in depth shall be measured on both sides of the canal. If the divergence should be less than 4 miles, the lots on the north side of the canal shall be 2 miles in width and shall extend in depth to the San Juan River.

Fifth. From Rio Frio to the Sapoa lots of 2 English miles in width by 2 in depth to the south of Lake Nicaragua, to 2 miles distance from the same lake and following the curves of its shores.

Sixth. Twenty-five lots of 2 English miles in width and 4 in depth each of the public lands which the company shall select in concurrence with the Government.

As a general rule, at the termini of the Interoceanic Canal, in case these should be within the territory of Costa Rica, the opposite lots shall be awarded, one to the Government and the other to the company; and if this should not be possible, the first in order shall belong to the Government.

The State shall place the association in possession of the lands as soon as the line of the canal shall have been definitively fixed and the work of construction shall have commenced. The rights acquired by individuals to the lands mentioned in the foregoing articles are reserved. The measurement and demarcation of all the lands ceded by this contract shall be made with the intervention of the Government and at the expense of the grantees.

The final titles shall not be issued save according as the work upon the canal progresses and in due proportion thereto.

From the Atlantic to 3 miles from "Castillo Viejo" the parts of the rivers San Juan and Colorado which the canal may occupy shall be considered as a part of the same for the purposes of this article.

It is understood that the total of the lands ceded by Costa Rica to the association, at different points and in the form expressed in the foregoing paragraphs, shall not exceed the fourth part of the total of lands conceded to the company by the Government of Nicaragua, according to the contract made by them, and in case it should exceed the difference shall be deducted by reducing the number of lots mentioned in the fifth clause of this article.

ARTICLE 21. The State reserves the right to occupy in the several lots ceded to the association the areas it may require for roads and

public buildings. It shall also have the right to make use of the woods and other building materials found on said lands whenever required for construction. With these lands, in virtue of a transfer by the company, become the property of individuals, should the State require them for the purposes mentioned in this article, or for any other, it shall compensate the owners in conformity with the laws, and the owners shall have no claim against the association. In case the company should have improved the lands, either for purposes of utility, ornament, or recreation, the State shall be bound to indemnify it for the damages it has sustained upon a just appraisement of experts.

ARTICLE 22. Mines of coal, gold, silver, iron, or other metals and quarries found on the lands ceded to the association belong to it by right without previous denouncement, and may be worked at its option, in accordance with the laws of the Republic; but the lands which the association transfer to individuals shall not enjoy this exemption.

ARTICLE 23. From the moment upon which it enters into possession thereof the association shall have the right to make use of, for the works of the canal and its dependencies, the timber found in the forests, situate on the lands ceded to it by the State, without prejudice to previously acquired rights.

ARTICLE 24. From the day upon which this concession shall be ratified by Congress none of the public lands which may be necessary for the construction of the canal, nor those ceded to the association along its margin, shall be sold; neither shall any of said lands be leased to the prejudice of the company. Notwithstanding, if at the time of the ratification of the contract the line of the canal should not have been definitively determined, it will be presumed that for the purposes of the present article such line will follow the northern frontier of Costa Rica. ARTICLE 25. The association shall have the right throughout the extent of the canal, within the territory of Costa Rica, at the mouth of the canal in the two oceans and in all the lands ceded by the present contract, as per articles 15, 16, and 20, to perform whatever works may be necessary for locating, leveling, excavating, and dredging, as also other works requisite for the establishment, feeding, operating, preservation, and maintenance of the canal.

Along the line of the canal and upon the Costa Rican margin of the River San Juan, its affluents and confluents in Costa Rica, as also the Costa Rican tributaries of Lake Nicaragua, the association is specially authorized to make use of the lakes and streams which can be utilized in their flows to the Pacific or Atlantic for the construction of dams and dikes, for rectifications, dredgings, embankments, location of buoys, and generally for all the works which the engineers of the association may find necessary for the construction, feeding, navigation, and use of the canal. The gradings, fillings, and dikes made in Costa Rican territory and at the mouths of the canal in the ports of both oceans from the materials taken from the canal excavations shall belong exclusively to the association, but the Government shall have the right upon indemnity therefor to make use of the same wholly or in part.

If any of the ports of the canal should be within Costa Rican territory the company shall not obstruct nor extend the shores thereof unless absolutely necessary. In such case, the gradings and fillings that it may be necessary to make opposite to the port shall belong to the Republic.

In general terms, the association shall have the right to use all the lakes and rivers of Costa Rica whose waters may be necessary, in the