740



FOREIGN RELATIONS, 19 4 2, VOLUME VI



  The undersigned Plenipotentiaries, being duly authorized for that
purpose, have agreed as follows:
                           ARTICLE I
  The Government of the United States of Venezuela shall notify
the Government of the United States of America of the nature, amount
and quality of the defensive war material which it is desirable to pur-
chase in conformity with its necessities and its possibilities of payment;
and the Government of the United States of America shall furnish it,
on the conditions set forth in this Agreement, with defense articles
and defense information, up to a scheduled cost which shall not exceed
a total of $15,000,000, of which $12,000,000 shall be for the use of
the Venezuelan Army and $3,000,000 for the use of the Venezuelan
Navy. The resulting financial obligations of the Government of the
United States of Venezuela shall not draw interest.
                           ARTICLE II
  The Government of the United States of America reserves the right
to suspend, defer or stop deliveries at any time when, in the opinion
of the President of the United States of America, further deliveries
are not consistent with the needs of the defense of the United States
of America or of the Western Hemisphere. Every effort will be made
to insure that deliveries of defense articles are made in such manner
that, on the suspension of any of them, those which may already have
been made shall not be incomplete.
                           ARTICLE III
  A commission of officers from the Army, Navy and Air Corps of
Venezuela shall confer with officers authorized by the Government
of the United States of America on the nature, quantity, quality and
scheduled cost of the defense articles to which the present Agreement
refers.
                           ARTICLE IV
  Records shall be kept of all defense articles transferred under this
Agreement, and not less than every ninety days schedules of such
defense articles shall be exchanged and reviewed.
  The Government of the United States of America agrees to accord
to the Government of the United States of Venezuela a reduction of
fifty-five percent in the scheduled cost of the materials that will be
delivered in compliance with the stipulations of the present Agree-
ment; and the Government of the United States of Venezuela promises
to pay in dollars into the Treasury of the United States of America
forty-five percent of the scheduled cost of the materials delivered.
The Government of the United States of Venezuela shall not be
required to pay