British North Borneo; mode of acquisition; absence of any real native government; oppression of the inland pagans by the coast Muhamadans. Failure of American syndicate's Chinese colonization scheme in 1865. Colonel Torrey interests Baron Overbeck in the American concessions; Overbeck interests Sir Alfred Dent, who commissions him to acquire a transfer of the concessions from the Sultans of Brunai and Sulu, 1877-78. The ceded territory known as Sabah. Meaning of the term. Spanish claims on ground of suzerainty over Sulu. Not admitted by the British Government. The writer ordered to protest against Spanish claims to North Borneo, 1879. Spain renounced claims, by Protocol, 1885. Holland, on ground of the Treaty of 1824, objected to a British settlement in Borneo; also disputed the boundary between Dutch and British Borneo. The writer 'violates' Netherland territory and hoists the Company's flag on the south bank of the Siboku, 1883. Annual tribute paid to the Brunai Government. Certain intervening independent rivers still to be acquired. Dent's first settlements at Sandakan, Tampassuk, and Pappar. Messrs. Pryer, Pretyman, Witti, and Everett. Opposition of Datu Bahar at Pappar. Difficult position of the pioneer officers. Respect for Englishmen inspired by Brooke's exploits. Mr. W. H. Read. Mr. Dent forms a 'Provisional Association' pending grant of a Royal Charter, 1881, composed of Sir Rutherford Alcock, A. Dent, R. B. Martin, Admiral Mayne, W. H. Read. Sir Rutherford energetically advocates the scheme from patriotic motives. The British North Borneo Company incorporated by Royal Charter, 1st November, 1881; nominal capital two millions, £20 shares. 33,030 shares issued. Powers and conditions of the Charter. Flag. CHAPTER VIII. PAGES 103-117.