HSBC London buys protection on The Howard Group
from ING PHYSICALLY SETTLED CREDIT PROTECTION TRANSACTION INDICATIVE SUMMARY TERMS:
The definitions and provisions contained in the 1999 ISDA Credit Derivatives Definitions, as supplemented by the Restructuring Supplement dated 11 May, 2001, the Supplement Relating to Convertible, Exchangeable or Accreting Obligations dated 9 November, 2001, the Supplement Relating to Successor and Credit Events dated 28 November, 2001, (the “Credit Derivatives Definitions”), as published by the International Swaps and Derivatives Association, Inc., are incorporated into this Indicative Summary Termsheet (the “Termsheet”) and any subsequent Confirmation.
For the avoidance of doubt, where any term or condition is not set out in this Termsheet, the fallback or term or condition set out in the Definitions shall be deemed to apply.
1. General Terms
Trade Date: Effective Date:
Scheduled Termination Date: Floating Rate Payer: Fixed Rate Payer: Calculation Agent: Calculation Agent City: Business Day: Business Day Convention:
Reference Entity: Reference Obligation(s);
22 January 2004
25 January 2004 25 January 2007 X (the “Seller”)
HSBC, London (the “Buyer”) Seller
New York
London, & New York Modified Following
The Howard Group
The obligation(s) identified as follows:
Primary Obligor: Corp.
Maturity: 15 September 2011
Coupon: 6.5%
CUSIP/ISIN: USXXX
Original Issue Amount: USD 50,000,000
Reference Price: 100%
2. Fixed Payments
Fixed Rate Payer Calculation Amount
USD 50,000,000
Fixed Rate Payer Payment Dates:
Fixed Rate:
Fixed Rate Day Count Fraction: 3. Floating Payment
Floating Rate Payer Calculation Amount:
Conditions to Payment:
4. Credit Events
Credit Events:
Grace Period Extension:
Payment Requirement:
Default Requirement:
Obligations:
Obligation Category: Obligation Characteristics:
5. Settlement Terms Settlement Method: Physical Settlement Period:
Portfolio:
Credit Default Swap
January 8, 2004
The 25th of April, August, November and January, commencing on May 25, 2005.
X% per annum Actual/360
USD 50,000,000
1. Credit Event Notice
Notifying Party: Buyer or Seller
2. Notice of Publicly Available Information Applicable
Public Source(s): Standard Public Sources
Specified Number: Two
3. Notice of Intended Physical Settlement
The following Credit Event(s) shall apply to this Transaction:
· Bankruptcy
· Failure to Pay
· Restructuring (including the terms of the Restructuring Supplement dated 11 May, 2001)
Not Applicable
USD 1,000,000 or its equivalent in the relevant Obligation Currency
USD 10,000,000 or its equivalent in the relevant Obligation Currency
· Borrowed Money
· None
Physical Settlement
Section 8.5 of the ISDA Credit Derivatives Definitions, subject to a maximum of 30 Business Days
Exclude Accrued Interest
Deliverable Obligation Category:
Deliverable Obligation Characteristics:
Credit Default Swap
January 8, 2004
~ Bond or Loan
· Pari Passu Ranking
· Specified Currencies: Standard Specified Currencies
· Assignable Loan
· Consent Required Loan
· Transferable
· Not Contingent
· Maximum Maturity: 30 years
· Not Bearer
· Restructuring Maturity Limitation Applicable
Excluded Deliverable Obligations:
Escrow:
Not Applicable
6. Dispute Resolution Applicable
7. Other Terms
Documentation: ISDA Confirmation to be provided by: HSBC
Offices: HSBC : London
Each party represents to the other party that it has full legal capacity to enter into this transaction and has obtained all legal and regulatory consents, licenses, authorisations and permissions, (including, but without prejudice to the generality of the foregoing, legal, accounting and tax opinions, and directors and shareholders approvals) necessary to execute, settle, and otherwise complete or perfect this transaction, and that the employees or agents of each party negotiating and concluding this transaction are authorised to do so in accordance with the law, regulation and internal policies pertaining to each party. Each party further represents to the other that it fully understands the transaction, its risks, consequences and outcomes, and has sought, as necessary, independent advice from suitably qualified persons to satisfy itself that that the transaction is appropriate and suitable for it. Each party enters into this transaction having made its own assessment of the merits of the transaction (including the advice referred to above). Neither party has given any guarantee or assurance to the other as to the risks, consequences or outcomes of this transaction. Each party is acting as principal on its own behalf, and not on behalf of any other person.
