811.20Defense (M)/74a

Memorandum of Agreement

Memorandum of Agreement dated as of June 28, 1940 between the Reconstruction Finance Corporation (herein called the “Corporation”), the Metals Reserve Company, a corporation created by the Reconstruction Finance Corporation (herein called the “Company”), and the International Tin Committee (herein called the “Committee”):

First,

In order to aid in the National Defense Program, the Corporation agrees that it will make a loan or loans to the Company upon satisfactory terms and conditions in such amount as may be necessary to enable the Company to purchase all of the tin available under the increased quota as hereinafter set forth as rapidly as the same is available for purchase.

Second,

The Company undertakes and agrees:

A.
To effect the purchase of tin as set forth in paragraph First hereof and to purchase all tin offered in accordance with, and which is acceptable under, the terms of this agreement, at a price of $.50 United States Dollars per pound, c. i. f. United States ports (as specified by Company), the insurance to cover all insurable risks, including war risks.
B.
To hold the tin acquired in accordance with the terms of this agreement for a period of not less than three years from January 1, 1941.
C.
To notify the Committee of its intention to liquidate its stocks of tin as more particularly hereinafter set forth and at the end of each three month period during the course of such liquidation to inform the Committee regarding the progress of such liquidation and the quantity remaining to be liquidated.

Thirds,

The Committee undertakes and agrees:

A.
To increase the quota of permissible tin exports to 130% of the Standard Tonnages effective as of July 1, 1940 and to maintain such quota at such rate for a period of one year from July 1, 1940.
B.
To recommend to all Governments which are parties to the International Tin Control Scheme that they should employ all means at their disposal to stimulate production and to encourage the sale of all available tin at not in excess of the price set forth in this agreement and in furtherance of such purpose to provide for the release of stock of tin in the producing countries, and adopt such measures as they can under the circumstances to insure the production of tin and its avail [Page 298] ability to the Company within the period fixed for the purchase of tin as set forth in this agreement and at the price named herein.
C.
That the Company at any time after the expiration of the aforesaid three year period (commencing January 1, 1941) shall have the right to liquidate its stock of tin, provided that it gives written notice thereof to the Committee and agrees that not more than 5% of such stock of tin with a maximum of 5,000 tons shall be liquidated in any three month period, beginning from a date three months after the date such notice has been given.
D.
That during the period of liquidation of the stock of tin held by the Company the quota of permissible tin exports shall be adjusted in such manner as to facilitate liquidation in an orderly manner.

Fourth,

It is understood and agreed by the parties hereto that:

A.
Tin acceptable under the terms of this agreement for purchase under the terms specified in paragraph Second A hereof shall be all brands of tin acceptable under the specifications of the Procurement Division of the Treasury Department (Form S 14) dated December 15, 1939. Such price shall apply to all purchases from prompt to ninety days forward shipments. The Company may purchase other qualities of tin with proper price differentials. Tin acceptable under this agreement and tin of other qualities (which may be purchased as herein provided) may be purchased by the Company on such other bases as for example ex works, f. a. s., f. o. b., with proper price differentials.
B.
The Company shall have the right to inspect, sample and analyze any delivery or brand of tin.
C.
The tin acquired by the Company may be released upon request of the United States Government for use by the United States Government and may be released to private consumers in the event of a national emergency which in the opinion of the Company requires such release.
D.
The obligation of the Committee under paragraphs Third A and B hereof and the obligation of the Company under paragraph Second A hereof with respect to making tin available for purchase by the Company, and the purchase by the Company of tin, shall terminate on June 30, 1941 unless sooner terminated by the Company at any time upon giving three months’ notice in writing to the other parties hereto, provided that a total of not less than 75,000 tons shall have been purchased and retained as a reserve prior to the date of giving of any such notice.
E.
In the event of extraordinary circumstances which may operate to affect the terms and conditions of this agreement, the parties hereto [Page 299] agree to consult for the purpose of determining what action shall be taken with respect to the provisions of this agreement.

Reconstruction Finance Corporation
By
Emil Schram

Chairman
Metals Reserve Company
By
Charles B. Henderson

The International Tin Committee
By
Victor A. Lowinger

By
J. Van den Broek

Approved:
Jesse H. Jones
Federal Loan Administrator