SUNTRUST EQUITABLE SECURITIES CORPORATION

303 Peachtree Street, N.E., 23rd Floor, Center Code 3913

Atlanta, Georgia  30308

MEMBER NASD AND SIPC

 

 

[j1947ex10d8image002.jpg]

 

December 21, 2000

 

Confirmation of Interest Rate Transaction

 

THIS LETTER AGREEMENT SHOULD BE REVIEWED, EXECUTED BY AN AUTHORIZED PERSON(S),
AND RETURNED IMMEDIATELY VIA FAX TO 404-532-0514.

(Please direct any questions to Ken Kuykendall at 404-532-0303.)

 

Barry Edwards

Chief Financial Officer

F.Y.I., Incorporated

3232 McKinney Ave.

Suite 900

Dallas, Texas  75204

Ph#:        214-953-7690

Fax#:       214-953-7556

 

REF:        11674/13660

 

Dear Mr. Edwards:

 

The purpose of this letter agreement is to set forth the terms and conditions of
the Rate Transaction entered into between F.Y.I., Incorporated (“Counterparty”
or “you”) and SunTrust Bank (“SunTrust” or “us”) on the Trade Date specified
below (the “Transaction”).  SunTrust Equitable Securities Corporation acts as
agent on behalf of SunTrust with respect to this Transaction.  This letter
agreement constitutes a “Confirmation” as referred to in the ISDA Master
Agreement to be entered into by the parties hereto.

 

The definitions and provisions contained in the 1991 ISDA Definitions published
by the International Swap and Derivatives Association, Inc. (“ISDA”), as amended
and supplemented by the 1998 Supplement to the 1991 ISDA Definitions (the
“Definitions”), are incorporated by reference into this Confirmation.  In the
event of any inconsistency between the Definitions and this Confirmation, this
Confirmation shall govern.

 

This Confirmation supplements, forms a part of, and is subject to the ISDA
Master Agreement, as amended and supplemented from time to time (the “Swap
Agreement”), between you and us.  All provisions contained or incorporated by
reference in the Swap Agreement shall govern this Confirmation except as
expressly modified below.  Prior to the execution and delivery of such Swap
Agreement, this Confirmation alone shall constitute a complete and binding
agreement with respect to the Transaction.

 

Each party is hereby advised, and each such party acknowledges, that the other
party has engaged in (or refrained from engaging in) substantial financial
transactions and has taken other material actions in reliance upon the parties’
entry in the Transaction to which this Confirmation relates on the terms and
conditions set forth below.

 

This Confirmation shall be governed by and construed in accordance with the laws
of the State of New York without reference to choice of law doctrine.

 

1.

The terms of the particular Transaction to which this Confirmation relates are
as follows:

 

 

 

Type of Transaction:

 

Swap Transaction

 

 

 

Notional Amount:

 

$50,000,000.00

 

 

 

Trade Date:

 

December 20, 2000

 

 

 

Effective Date:

 

December 22, 2000

 

 

 

Termination Date:

 

March 31, 2003, with adjustment in accordance with the Modified Following
Business Day Convention

 

 

 

Fixed Amounts:

 

 

 

 

 

Fixed Rate Payer:

 

Counterparty

 

 

 

Fixed Rate Payer Payment Dates:

 

The last day of each month, beginning January 31, 2001, through and including
the Termination Date, subject to adjustment in accordance with the Modified
Following Business Day Convention

Fixed Rate:

 

5.775% per annum

 

 

 

Fixed Rate Day Count Fraction:

 

Actual/360

 

 

 

Adjustment to Period End Dates:

 

Applicable

 

 

 

Floating Amounts:

 

 

 

 

 

Floating Rate Payer:

 

SunTrust

 

 

 

Floating Rate Payer Payment Dates:

 

The last day of each month, beginning January 31, 2000, through and including
the Termination Date, subject to adjustment in accordance with the Modified
Following Business Day Convention

 

 

 

Floating Rate for initial Calculation Period:

 

6.66375%

 

 

 

Floating Rate Day Count Fraction:

 

Actual/360

 

 

 

Designated Maturity:

 

1 month

 

 

 

Floating Rate Option:

 

USD-LIBOR-BBA

 

 

 

Spread:

 

Inapplicable

 

 

 

Adjustment to Period End Dates:

 

Applicable

 

 

 

Reset Dates:

 

The first day of each Floating Rate Payer Calculation Period

 

 

 

Calculation Agent:

 

SunTrust

 

 

 

Business Days:

 

New York

 

 

2.             Other Provisions

 

(a)           You agree to provide us (i) Corporate Resolutions, and (ii) a
Certificate of Incumbency with respect to the individual(s) executing this
Confirmation, both documents evidencing your authority to enter into this
Transaction.  This Provision (2)(a) shall constitute an additional Agreement for
the purpose of Section 4 of the Swap Agreement.

 

(b)          By signing this Confirmation, you acknowledge that you have
received and understand the SunTrust Bank “Terms of Dealing for OTC Risk
Management Transactions” and the “Risk Disclosure Statement for OTC Risk
Management Transactions” (each attached hereto and incorporated by reference
into this Confirmation).

 

(c)           “Loan Agreement” shall mean each agreement, related by its terms
to this Transaction, to which you (as borrower) and SunTrust (or one of its
Affiliates) are or hereafter become parties (and to which other lenders may be
parties) involving the making of loans, extensions of credit or financial
accommodations thereunder or commitments therefor, in the form existing on the
date when that agreement is executed and without regard to any termination or
cancellation thereof, whether by reason of payment of all indebtedness incurred
thereunder or otherwise, as such Loan Agreement may be amended, supplemented,
otherwise modified, replaced, or substituted.

 

3.             Account Details

 

Payment to Counterparty:

 

Depository: Bank One, Chicago

ABA # 071000013

Favor of: F.Y.I. Incorporated

Account # 10-50780

 

Payments to SunTrust:

 

SunTrust Bank

ABA # 061000104

FBO:  Bond Wire Clearing

Account # 9088-0000-95

Attn: Financial Risk Management, Operations

 

4.             Offices

 

(a)           The Office of Counterparty for the Transaction is its Dallas
office; and

 

(b)          The Office of SunTrust for the Transaction is its Atlanta office.

 

By signing below, you also acknowledge and agree that we have explained to you
the risks involved in this Transaction, which risks include but are not limited
to the following:

 

•               Market Risk:  The risk that the Transaction may increase or
decrease in value with a change in, among other things, interest rates or the
yield curve; and

 

•               Liquidity Risk:  The risk that the Transaction cannot be closed
out or disposed of quickly at or near its value.

 

You further acknowledge and agree that you understand these risks and the
Transaction as a whole, that you are capable of managing the risks associated
with this Transaction, that the risks involved in this Transaction are
consistent with your financial goals, policies and procedures, and risk
tolerance, and that you have determined that this Transaction is appropriate for
you.

 

Please confirm that the foregoing correctly sets forth the terms of our
agreement by signing this copy of this Confirmation and immediately returning it
to SunTrust Equitable Securities Corporation via fax at the number indicated on
Page 1.

 

Very truly yours,

 

Accepted and Confirmed as of the date first written:

 

 

 

SUNTRUST BANK

 

F.Y.I., INCORPORATED

 

 

 

By:

/s/  Fred D. Woolf

 

 

By:

/s/  Barry Edwards

 

Fred D. Woolf

 

Name:

Barry Edwards

 

Vice President

 

Title:

Executive Vice President and

 

 

 

Chief Financial Officer

 

SunTrust Bank (“SunTrust”)

Terms of Dealing for OTC Risk Management Transactions

 

In connection with the negotiation, entry into, and performance from time to
time of over-the-counter (“OTC”) risk management transactions, please be advised
that:

 

SunTrust acts as principal only and does not act as advisor, agent, broker, or
fiduciary for or with respect to any counterparty (unless otherwise expressly
agreed in a written engagement letter).

 

SunTrust expects that its counterparties have the authority and capacity to
enter into and perform their obligations under their OTC risk management
transactions with SunTrust, and SunTrust relies on the express and implied
representations of its counterparties with respect thereto.

 

SunTrust expects that its counterparties possess adequate knowledge and
experience to assess independently, or with the assistance of their own
advisors, the merits and risks of each OTC risk management transaction that the
counterparty may from time to time enter into, amend, or terminate.

 

SunTrust endeavors to maintain the confidentiality of all confidential
counterparty information and expects its counterparties to do the same.  Unless
a counterparty gives SunTrust written notice to the contrary, each counterparty
authorizes SunTrust and all SunTrust affiliates, including SunTrust Equitable
Securities Corporation (STES), to share with each other confidential information
concerning a counterparty and/or its accounts for marketing or other purposes
from time to time.   Any trade ideas, term sheets, and other similar documents
sent to counterparties by SunTrust are not to be shared with others.

 

SunTrust may pay fees, commissions, and other amounts to agents, brokers, and/or
other third parties in connection with OTC risk management transactions entered
into with counterparties.  SunTrust considers the amount of such fees,
commissions, and other amounts to be confidential and does not disclose the same
to its counterparties.

 

SunTrust may from time to time receive orders for similar or identical
transactions, and SunTrust makes no representation with respect to execution
priorities.

 

STES’s Authorized Officers have the authority to bind SunTrust in connection
with OTC risk management transactions.  A current list of Authorized Officers
may be obtained from STES upon request.

 

OTC risk management obligations of SunTrust are not FDIC insured.

 

SunTrust Bank (“SunTrust”)

Risk Disclosure Statement for OTC Risk management Transactions

 

Over-the-counter (“OTC”) risk management transactions, like other financial
transactions, involve a variety of significant potential risks.  OTC risk
management transactions generally include options, forwards, swaps, swaptions,
caps, floors, collars, combination and variations of such instruments, and other
executory contractual arrangements, and may involve interest rates, currencies,
securities, commodities, equities, credit, indices, and other underlying
interests.

 

Before entering into any OTC risk management transaction, you should carefully
consider whether the transaction is appropriate for you in light of your
experience, objectives, financial and operational resources, and other relevant
circumstances.  You should also ensure that you fully understand the nature of
the transaction and contractual relationship into which you are entering and the
nature and extent of your exposure to risk of loss, which may significantly
exceed the amount of any initial payment or investment by you.

 

The specific risks presented by a particular OTC risk management transaction
necessarily depend upon the character of the specific transaction and your
circumstances.  In general, however, all OTC risk management transactions
involve the risk of adverse or unanticipated market developments, risk of
illiquidity and credit risk, and may involve other material risks.  Equity risk
management transactions may increase or decrease in value with a change in,
among other things, stock prices and interest rates which could result in
unlimited loss.  In addition, you may be subject to internal operational risks
in the event that appropriate internal systems and controls are not in place to
monitor the various risks and funding requirements to which you are subject by
virtue of your activities in the OTC risk management and related markets.  OTC
risk management transactions frequently are tailored to permit parties to
customize transactions to accomplish complex financial and risk management
objectives.  Such customization can also introduce significant risk factors of a
complex character.

 

As in any financial transaction, you must understand the requirements (including
investment restrictions), if any, applicable to you that are established by your
regulators or by your Board of Directors or other governing body.  You should
also consider the tax and accounting implications of entering into any risk
management or other transaction.  To the extent appropriate in light of the
specific transaction and your circumstances, you should consider consulting such
advisers as may be appropriate to assist you in understanding the risks
involved.  If you are acting in the capacity of financial adviser or agent, you
must evaluate the foregoing matters in light of the circumstances applicable to
your principal.

 

In entering into any OTC risk management transaction, you should also take into
consideration that, unless you and SunTrust have established in writing an
express financial advisory or other fiduciary relationship or you and SunTrust
have expressly agreed in writing that you will be relying on SunTrust’s
recommendations as the primary basis for making your trading or investment
decisions, SunTrust is acting solely in the capacity of an arm’s-length
contractual counterparty and not in the capacity of your financial advisor or
fiduciary.  In addition, SunTrust or its affiliates may from time to time have
substantial long or short positions in and may make a market in or otherwise buy
or sell instruments identical or economically related to the OTC risk management
transaction entered into with you or may have an investment banking or other
commercial relationship with the issuer of any security or financial instrument
underlying an OTC risk management transaction entered into with you.

 

THIS BRIEF STATEMENT DOES NOT DISCLOSE ALL OF THE RISKS AND OTHER SIGNIFICANT
ASPECTS OF ENTERING INTO OTC RISK MANAGEMENT TRANSACTIONS.  YOU SHOULD REFRAIN
FROM ENTERING INTO ANY SUCH TRANSACTION UNLESS YOU FULLY UNDERSTAND ALL SUCH
RISK AND HAVE INDEPENDENTLY DETERMINED THAT THE TRANSACTION IS APPROPRIATE FOR
YOU.