Exhibit 10.52
DEUTSCHE BANK
Aktiengesellschaft
Date: June 2, 2003
To: Xxxxxxx Properties L.P.
Attention: Xxxx Xxxxxxxx
Facsimile no.: 1 213 533 5102
cc: Chatham Financial
Facsimile no.: 1 610 925 3125
OUR REFERENCE: GLOBAL NO. N235205N
RE: SWAPTION TRANSACTION
Ladies and Gentlemen:
The purpose of this letter agreement is to set forth the terms and conditions of
the Transaction entered into between Deutsche Bank AG ("DBAG") and Xxxxxxx
Properties LP ("Counterparty") on the Trade Date specified below (the
"Transaction"). This letter agreement constitutes a "Confirmation" as referred
to in the 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. are incorporated by reference herein. In the event of any
inconsistency between the Definitions and this Confirmation, this Confirmation
will govern.
For the purpose of this Confirmation, all references in the Definitions or the
Agreement to a "Swap Transaction" shall be deemed to be references to this
Transaction.
1. This Confirmation evidences a complete and binding agreement between DBAG
("Party A") and Counterparty ("Party B") as to the terms of the Transaction to
which this Confirmation relates. This Confirmation, together with all other
documents referring to the ISDA Form (each a "Confirmation") confirming
Transactions (each a "Transaction") entered into between us (notwithstanding
anything to the contrary in a Confirmation) shall supplement, form a part of,
and be subject to an agreement in the form of the ISDA Master Agreement
(Multicurrency-Cross Border)(the "ISDA Form") (as may be amended, modified or
supplemented from time to time, the "Agreement") as if we had executed an
agreement on the Trade Date of the first such Transaction between us in such
form, with Schedule thereto (i) specifying only that (a) the governing law is
the laws of the State of New York, without reference to choice of law doctrine,
and (b) the Termination Currency is U.S. Dollars and (ii) incorporating the
addition to the definition of "Indemnifiable Tax" contained in (page 48 of) the
ISDA "User's Guide to the 1992 ISDA Master Agreements" with the modifications
contained herein. In the event of any inconsistency between the terms of this
Confirmation, and the terms of the Agreement, this Confirmation will prevail for
the purpose of this Transaction.
2. The Transaction to which this Confirmation relates is a Swaption, the terms
of which are as follows:
(a) SWAPTION TERMS
Trade Date: June 2, 2003
Option Style: European
Seller: DBAG
Buyer: Counterparty
Premium: USD 1,520,050.00
Premium Payment Date: June 4, 2003
Exercise Business Day: New York
(b) PROCEDURE FOR EXERCISE:
Expiration Date: June 30, 2003
Earliest Exercise Time: 9:00 a.m., New York time
Expiration Time: 11:00 a.m., New York time, subject to Section 2(d)
Fallback Exercise: Applicable
(c) SETTLEMENT TERMS:
Settlement: Cash, subject to Section 2(d)
Cash Settlement Valuation
Time: 11:00 a.m., New York time, subject to Section 2(d)
Cash Settlement
Payment Date: Two Business Days following the Exercise Date
Cash Settlement Method: Cash Price
Settlement Rate: Inapplicable
Cash Settlement Reference
Banks: As defined in Section 2(d)
Quotation Rate: Mid
(d) ADDITIONAL CASH SETTLEMENT TERMS:
This Transaction will be terminated on the Exercise Date. The amount determined to be due to a party in respect of this
cash settlement (the "Cash Settlement Amount") shall be payable two New York Business Days following the Exercise Date and shall be
determined in accordance with the following:
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(1) The parties shall attempt to agree by no later than 2:00 p.m.
New York
City time of the Exercise Date on the mid-market cash settlement value
of a swap transaction of the same characteristics and equal maturity
to this Swap Transaction as outstanding on the Exercise Date.
(2) If Counterparty and DBAG fail to reach an agreement, the Cash
Settlement Amount shall be determined in accordance with Section 17.3
of the 2000 ISDA Definitions, specifically:
Cash Settlement Method: Cash Price
Cash Settlement Reference Banks: To be agreed upon by Counterparty
and DBAG, however, if fewer than
three quotations are provided,
the last sentence of Section
17.3(a) of the 2000 ISDA
Definitions will be replaced by
the last sentence of Section
17.3(b) of the 2000 ISDA
Definitions.
Quotation Rate: Mid
DBAG (as determined by DBAG and agreed to by Counterparty) shall pay
to Counterparty the Cash Settlement Amount on the Effective Date.
Once the Cash Settlement Amount has been fully and finally paid, then
all rights, duties and obligations of the parties under and with
respect to this Transaction shall terminate.
3. The terms of the particular Transaction to which this Confirmation relates
are as follows:
Type of Transaction: Interest Rate Swap
Notional Amount: USD 301,000,000.00
Effective Date: July 2, 2003
Termination Date: July 2, 2007, subject to adjustment
in accordance with the Modified
Following Business Day Convention.
FIXED AMOUNTS:
Fixed Rate Payer: Counterparty
Fixed Rate Payer Period End Dates: The 2nd day of each month of each
year, commencing August 2, 2003,
through and including the
Termination Date
Fixed Rate Payer Payment Dates: The 2nd day of each month of each
year, commencing August 2, 2003,
through and including the
Termination Date
Fixed Rate: 2.29%
Fixed Rate Day Count Fraction: Actual/360
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Fixed Rate Payer Business Days:
New York
Fixed Rate Payer Business Day Convention: Modified Following
FLOATING AMOUNTS:
Floating Rate Payer: DBAG
Floating Rate Payer Period End Dates: The 2nd day of each
month of each year,
commencing August 2,
2003, through and
including the
Termination Date
Floating Rate Payer Payment Dates: The 2nd day of each month
of each year, commencing
August 2, 2003, through
and including the
Termination Date
Floating Rate for initial Calculation Period: To be determined
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: One month
Spread: None
Floating Rate Day Count Fraction: Actual/360
Reset Dates: The first Floating Rate
Payer Business Day of
each Calculation Period
or Compounding Period, if
Compounding is
applicable.
Compounding: Inapplicable
Floating Rate Payer Business Days:
New York
Floating Rate Payer Business Day
Convention: Modified Following
4. ACCOUNT DETAILS:
USD DBAG Payment Instructions:
Account With: Deutsche Bank AG,
New York
SWIFT Code: XXXXXX00
Favor Of: Deutsche Bank AG, New York
Account Number: 100440170004
USD Counterparty Payment Instructions: Please provide
5. OFFICES:
The Office of DBAG for this Transaction is New York.
6. CALCULATION AGENT: The party specified as
such in the Agreement, or
if not specified therein,
DBAG.
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7. REPRESENTATIONS
Counterparty, if it is a nonresident alien individual, foreign corporation,
foreign partnership, foreign trust, or foreign estate, represents that it
is a foreign person for purposes of US Treasury regulations relating to
information reporting and backup withholding.
Each party will be deemed to represent to the other party on the date on
which it enters into this Transaction that (absent a written agreement
between the parties that expressly imposes affirmative obligations to the
contrary for this Transaction):
(i) NON-RELIANCE. It is acting for its own account, and it has made its own
independent decisions to enter into this Transaction and as to whether this
Transaction is appropriate or proper for it based upon its own judgement
and upon advice from such advisers as it has deemed necessary. It is not
relying on any communication (written or oral) of the other party as
investment advice or as 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. No communication (written
or oral) received from the other party shall be deemed to be an assurance
or guarantee as to the expected results of this Transaction.
(ii) ASSESSMENT AND UNDERSTANDING. It is capable of assessing the merits of
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 risks of
this Transaction.
(iii) STATUS OF PARTIES. The other party is not acting as a fiduciary for,
or an adviser to it in respect of this Transaction.
8. ASSIGNMENT PROVISIONS:
This contract may be assigned to a major market maker with DBAG's consent,
which will not be unreasonably withheld or delayed.
9. MODIFICATIONS TO THE ISDA FORM:
"SPECIFIED ENTITY" means"
(i) in relation to Party A: Not Applicable
(ii) in relation to Party B: Not Applicable
The "CROSS DEFAULT" provisions of Section 5(a)(vi) will apply to Party A
and Party B subject to amendment:
such that the words ", or becoming capable at such time of being declared,"
will be deleted and by adding at the end thereof the following words:
"provided, however, that, notwithstanding the foregoing, an Event of
Default shall not occur under either (1) or (2) above if (A)(I) the
default, or other similar event or condition referred to in (1) or the
failure to pay referred to in (2) is a failure to pay or deliver caused by
an error or omission of an administrative or operational nature, and (II)
funds or the asset to be delivered were available to such party to enable
it to make the relevant payment or delivery when due and (III) such payment
or delivery is made within three (3) Local Business Days following receipt
of written notice from an interested party of such failure to pay, or (B)
such party was precluded from paying, or was unable to pay, using
reasonable means, through the office of the
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party through which it was acting for purposes of the relevant Specified
Indebtedness, by reason of force majeure, act of State, illegality or
impossibility."
With regard to Party A, "Threshold Amount" means 3% of its shareholders'
equity (i.e., the sum of capital and disclosed reserves as reported in the
most recently published annual audited consolidated financial statements of
Deutsche Bank AG.)
With regard to Party B, "Threshold Amount" means $10,000,000.
The "CREDIT EVENT UPON MERGER" provision in Section 5(b)(iv) will apply to
Party A and Party B.
The "AUTOMATIC EARLY TERMINATION" provision of Section 6(a) will not apply
to Party A and will not apply to Party B.
"ADDITIONAL TERMINATION EVENT" will not apply to Party A and will not apply
to Party B.
PAYMENTS ON EARLY TERMINATION. For the purpose of Section 6(e) of this
Agreement:
(i) Market Quotation
(ii) The Second Method will apply.
PAYEE TAX REPRESENTATIONS. For the purpose of Section 3(f) of this Agreement,
Party A and Party B each represent to the other that, in respect of each
Transaction which it enters into through an Office or discretionary agent in
the United States of America ("U.S."), each payment received or to be received
by it under that Transaction will be effectively connected with its conduct of
a trade or business in the U.S.
10. SET OFF
Section 6 of this Agreement is amended by the addition of the following
Section 6(f):
"(f) Upon the designation of any Early Termination Date, the party that is
not the Defaulting Party or Affected Party ("X") may, without prior notice
to the Defaulting or Affected Party ("Y)", set off any sum or obligation
(whether or not arising under this Agreement, whether matured or unmatured,
whether or not contingent and irrespective of the currency, place of
payment or booking office of the sum or obligation) owed by Y to X (the "X
Set Off Amount") against any sum or obligation (whether or not arising
under this Agreement, whether matured or unmatured, whether or not
contingent and irrespective of the currency, place of payment or booking
office of the sum or obligation) owed by X to Y (the "Y Set Off Amount"). X
will give notice to the other party of any set off effected under this
Section 6(f).
For this purpose, either the X Set Off Amount or the Y Set Off Amount (or
the relevant portion of such set amounts) may be converted by X into the
currency in which the other set off amount is denominated at the rate of
exchange at which X would be able, acting in a reasonable manner and in
good faith, to purchase the relevant amount of such currency.
If a sum or obligation is unascertained, X may in good faith estimate that
obligation and set-off in respect of the estimate, subject to the relevant
party accounting to the other when the obligation is ascertained.
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Nothing in this Section 6(f) shall be effective to create a charge or other
security interest. This Section 6(f) shall be without prejudice and in addition
to any right of set-off, combination of accounts, lien or other rights to which
any party is at any time otherwise entitled (whether by operation of law,
contract or otherwise)."
11. Please confirm that the foregoing correctly sets forth the terms of our
agreement by having an authorized officer sign this Confirmation and return it
via facsimile or e-mail to:
Attention: Derivative Documentation
Telephone: 00 00 0000 0000
Facsimile: 44 20 7545 9761
E-mail: Xxxxxxxxxx.Xxxxxxxxxxxxx@xx.xxx
This message will be the only form of Confirmation dispatched by us. If you
wish to exchange hard copy forms of this Confirmation, please contact us.
Yours sincerely,
Deutsche Bank AG
BY: /s/ Xxxxxxx Xxxxx
NAME: Xxxxxxx Xxxxx
AUTHORIZED SIGNATORY
BY: /s/ Xxxxxx XxXxxxxxx
NAME: Xxxxxx XxXxxxxxx
AUTHORIZED SIGNATORY
Confirmed as of the date first written above:
Xxxxxxx Properties LP
By:
Name:
Title:
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