DATE: Sep 10. 2003
Exhibit 10(ak)
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DATE: |
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Sep 10. 2003 |
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TO: |
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MAINE PUBLIC SERVICE COMPANY (Party B) |
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ATTN: |
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XXXX X XXXXXXXXX |
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FAX: |
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000-000-0000 |
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PHONE: |
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000-000-0000 |
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FROM: |
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Fleet National Bank (Party A) |
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ATTN: |
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Derivatives Confirmation Unit |
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FAX: |
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(000) 000-0000 |
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PHONE; |
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(000)000-0000 or (000) 000-0000 |
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RE: |
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INTEREST RATE SWAP |
The purpose of this letter agreement is to set forth the terms and conditions of the Transaction entered into between Fleet National Bank Party A and MAINE PUBLIC SERVICE COMPANY Party B on the Trade Date specified below (the “Transaction”). This letter constitutes a “Confirmation” as referred to in the ISDA Master Agreement specified below.
The definitions and provisions contained in the 2000 ISDA Definitions (the “Definitions”), as published by the International Swaps and Derivatives Association, Inc. (“ISDA”), are incorporated into this Confirmation. In the event of any inconsistency between the Definitions and provisions in this confirmation, this Confirmation will govern.
1. This Confirmation constitutes a “Confirmation” as referred to in, and supplements, forms a part of and is subject to, the ISDA Master Agreement dated as of 9//09/03, as amended and supplemented from time to time (the “Agreement”), between you and us. All provisions contained in the Agreement govern this Confirmation except as expressly modified below.
2. The terms of the particular Transaction to which this Confirmation relates are as follows:
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Trade Date |
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Sep 09, 2003 |
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Effective Date |
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Sep 09, 2003 |
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Termination Date |
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Jun 01, 2007 subject to adjustment in accordance with the Modified Following Business Day Convention. |
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Notional Amount |
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USD 8,740,000.00 |
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NOTIONAL AMOUNT - FLOATING AMOUNTS SIDE
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From Date |
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To Date |
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Ccy |
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Notional |
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Sep 09, 2003 |
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Dec 01,2003 |
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USD |
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8,740,000.00 |
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Dec 01, 2003 |
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Jun 01,2004 |
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USD |
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8,080,000.00 |
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Jun 01, 2004 |
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Dec 01,2004 |
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USD |
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7,375,000.00 |
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Dec 01, 2004 |
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Jun 01,2005 |
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USD |
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6,630,000.00 |
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Jun 01, 2005 |
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Dec 01,2005 |
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USD |
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5,840,000.00 |
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Dec 01, 2005 |
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Jun 01,2006 |
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USD |
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5,005,000.00 |
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Jun 01, 2006 |
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Dec 01,2006 |
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USD |
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4,115,000.00 |
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Dec 01, 2006 |
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Jun 01,2007 |
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USD |
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3,175,000.00 |
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NOTIONAL AMOUNT - FIXED AMOUNTS SIDE
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From Date |
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To Date |
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Ccy |
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Notional |
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Sep 09, 2003 |
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Dec 01, 2003 |
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USD |
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8,740,000.00 |
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Dec 01, 2003 |
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Jun 01, 2004 |
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USD |
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8,080,000.00 |
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Jun 01, 2004 |
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Dec 01, 2004 |
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USD |
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7,375,000.00 |
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Dec 01, 2004 |
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Jun 01, 2005 |
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USD |
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6,630,000.00 |
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Jun 01, 2005 |
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Dec 01, 2005 |
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USD |
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5,840,000.00 |
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Dec 01, 2005 |
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Jun 01, 2006 |
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USD |
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5,005,000.00 |
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Jun 01, 2006 |
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Dec 01, 2006 |
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USD |
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4,115,000.00 |
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Dec 01, 2006 |
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Jun 01, 2007 |
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USD |
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3,175,000,00 |
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Floating Amounts
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Floating Rate Payer |
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Fleet National Bank |
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Floating Rate Payment Dates |
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Monthly on the 1st, commencing Oct 01, 2003 and ending on the Termination Date subject to adjustment in accordance with the Modified Following Business Day Convention. |
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Floating Rate Option |
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USD-LIBOR-BBA |
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Designated Maturity |
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1 month |
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Spread |
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None |
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Floating Rate Day Count Fraction |
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ACTUAL / ACTUAL |
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Floating Rate Reset Dates |
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The last Business Day of each Calculation Period |
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Compounding |
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Inapplicable |
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Method of Averaging |
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Weighted Average |
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Business Days |
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New York and London |
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Fixed Amounts
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Fixed Rate Payer |
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Fixed Rate Payment Dates |
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Monthly on the 1st, commencing Oct 01, 2003 and ending on the Termination Date subject to adjustment in accordance with the Modified Following Business Day Convention. |
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Fixed Rate |
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2.790000% |
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Fixed Rate Day Count Fraction |
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ACTUAL /360 |
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Business Days |
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New York and London |
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Calculation Agent |
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Fleet National Bank |
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Governing Law |
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New York law |
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Documentation |
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ISDA Master Agreement to be provided by Fleet National Bank |
3. Relationship Between Parties
Each party represents to the other party that:
(a) Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter this Transaction and as to whether this Transaction is appropriate or proper for it based upon its own judgment and upon advice from such advisors as it has deemed necessary. It is not relying on any communication (written or oral) from the other party as investment advice or am a recommendation to enter into this Transaction; it being understood that information and explanations related to the terms and conditions of this Transaction shall not be considered investment advice or a recommendation to enter into this Transaction. It has not received from the other party any assurance or guarantee as to the expected results of this Transaction.
(b) Evaluation and Understanding. It is capable of evaluating and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of this Transaction. It is also capable of assuming, and assumes, the financial and other risks of this Transaction.
(c) Status of Parties. The other party is not acting as a fiduciary or an advisor for it in respect of this Transaction.
(d) Risk Management. It has entered into this Transaction for the purpose of (i) managing its borrowings or investments, (ii) hedging its underlying assets or liabilities or (iii) in connection with its line of business.
(e) It is an “eligible contract participant” as defined in Section la(12) of the Commodity Exchange Act.
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4. Additional Termination Event will apply.
(i) The occurrence of any of the following shall constitute an Additional Termination Event with respect to Party B for which Party B will be the Affected Party:
(1) Party A in no longer party to any or all of the Credit Support Documents identified in Part 4(f)(ii) of the Schedule to the Agreement, as such documents are amended, modified, or supplemented from time to time.
(2) Any or all of the Credit Support Documents identified in Part 4(f)(ii) of the schedule to the Agreement, as such documents are amended, modified, or supplemented from time to time, are terminated or ceases to exist for any reason prior to the satisfaction of the obligations of this Transaction
(ii) Notwithstanding section 6(b) of the Agreement or any other provision of the Agreement, Party A shall not initially have the right to designate an Early Termination Date upon the occurrence of an Additional Termination Event. In lieu of the right to designate an Early Termination Date, Party A grants Party B the rights specified in the following subparts (1) or (2) to assign, as applicable, either Party A or Party B’s rights and obligation under this Transaction.
(1) Party B shall be permitted to instruct Party A to assign Party A’s rights and obligation under the Agreement to a substitute swap provider reasonably acceptable to Party A and Party B (“Substitute Swap Provider”), provided the Substitute Swap Provider expressly assumes Party A’s rights and obligations under this Agreement in a writing reasonably satisfactory to Party A and Party B.
(2) Party B shall be permitted to assign its rights and obligations under the Agreement to a Substitute Swap Provider, provided the Substitute Swap Provider expressly assumes Party B’s rights and obligations under this Agreement in a writing reasonably satisfactory to Party A and Party B.
Party A shall have the right to designate an Early Termination Date under Section 6(b) of the Agreement and this Additional Termination Event if this Transaction is not assigned pursuant within twenty (20) Business Days from the date the Additional Termination Event occurs.
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5. Acknowledgement
MAINE PUBLIC SERVICE COMPANY acknowledges and agrees that:
(a) absent an express written agreement to the contrary, an agreement by the parties to voluntarily terminate the Transaction before its scheduled termination date is contingent upon the payment by one party to the other of the costs associated with terminating the Transaction. Such costs shall include, but may not be limited to, the aggregate difference between the market value of the terminated portion of the Transaction and the market value of a similar transaction executed on the termination date with a notional amount and term equal to the terminated portion of the Transaction. Any termination cost paid by MAINE PUBLIC SERVICE COMPANY to terminate the Transaction is in addition to and not part of any yield maintenance fee, prepayment penalty or other expense that MAINE PUBLIC SERVICE COMPANY may pay in connection with the prepayment of a loan transaction with Fleet National Bank or its affiliate; and
(b) this acknowledgement or the provision by Fleet National Bank of a valuation or indicative termination price does not constitute a commitment by Fleet National Bank to terminate the Transaction at such price, or otherwise, prior to its scheduled termination date. The price and terms at which the Transaction may be terminated will be individually negotiated and, accordingly, may vary from the price and terms offered by other financial institutions. Any commitment to terminate the Transaction shall not be binding upon the parties unless expressly agreed to by Fleet National Bank.
6. Settlement Instructions
Payments to MAINE PUBLIC SERVICE COMPANY in USD
*** Payment Instructions To Be Advised ***
Payments to Fleet National Bank in USD
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To |
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Fleet National Bank ABA: 000000000 |
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Favor Of |
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Fleet National Bank |
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Account Number |
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0000000-29480 |
7. contact Instructions
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Fleet National Bank: |
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Tel: 000-000-0000 |
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Resets/Payments |
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Fax: 000-000-0000 |
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Confirmations |
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Tel: 000-000-0000 |
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Fax: 000-000-0000 |
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MAINE PUBLIC SERVICE COMPANY: |
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Tel: 000-000-0000 |
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Fax: 000-000-0000 |
Very truly yours,
Fleet National Bank
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By: |
/s/ [ILLEGIBLE] |
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By: |
/s/ [ILLEGIBLE] |
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Name: |
Name: |
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Title: |
Title: |
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Agreed and accepted as of the date first above written:
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By: |
/s/ Xxxx X. Xxxxxxxxx |
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Name: |
Xxxx X. Xxxxxxxxx |
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Title: |
Senior VP & CFO |
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PLEASE COUNTERSIGN AND FAX TO: (000) 000-0000
ATTN: Derivatives Confirmations
REQUEST CORRECTIONS: (000) 000-0000
Please be advised telephone
calls may be recorded to ensure
transaction accuracy.
80644FB
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