Goldman could also arrange an ECU/yen swap intermediated by Industrial Bank of Japan (IBJ), a powerful Japanese commercial bank rated AAA. In this arrangement, Disney would exchange its ECU Eurobond net proceeds in exchange for IBJ making future ECU payments to Disney that exactly matched the coupons and principal payments of the Eurobonds (Exhibit 7, column A). At the same time, Disney would receive the yen equivalent of the net ECU proceeds from the Eurobond, converted at the spot rate, and would make future semiannual yen swap payments according to a fixed schedule (Exhibit 7, column B). Disney could then exchange the initial yen proceeds for dollars at the spot rate in order to reduce its short-term borrowings. At the time of the proposal, the ECU spot exchange rate was $.7420 per ECU, and the yen/dollar exchange rate was -248 per dollar. Exhibit 7 ECU/Yen Swap Flows, in Millions (assuming $/ECU of .7420 and yen/dollar of 248) Disneys Swap Flows: Received from/(paid to) IBJ French Utilitys Swap Flows: Received from/(paid to) IBJ Year ECU (A) Yen (B) ECU (C) Yen (D) 0.0 (78.499) 14,445.153 a 80.000 b (14,445.153) b 0.5 (483.226) 483.226 1.0 7.300 (483.226) (7.350) 483.226 1.5 (483.226) 483.226 2.0 7.300 (483.226) (7.350) 483.226 2.5 (483.226) 483.226 3.0 7.300 (483.226) (7.350) 483.226 3.5 (483.226) 483.226 4.0 7.300 (483.226) (7.350) 483.226 4.5 (483.226) 483.226 5.0 7.300 (1,808.141) (7.350) 1,808.141 5.5 (1,764.650) 1,764.650 6.0 23.300 (1,721.160) (23.350) 1,721.160 6.5 (1,677.670) 1,677.670 7.0 21.840 (1,634.179) (21.880) 1,634.179 7.5 (1,590.689) 1,590.689 8.0 20.380 (1,547.199) (20.410) 1,547.199 8.5 (1,503.708) 1,503.708 9.0 18.920 (1,460.218) (18.940) 1,460.218 9.5 (1,416.728) 1,416.728 10.0 17.460 (1,520.450) (17.470) 1,520.450 Note: These cash flows exclude fees paid to either IBJ or Goldman Sachs. aThe initial yen principal received by Disney from IBJ are relevant only to the swap transaction and the calculation of an all-in yen financing cost. By exchanging the initial yen for dollars in the spot market, Disney would eventually obtain new dollar financing. bThe principal amounts for the French utility are strictly notional; no net new funding would be obtained by the utility as a result of the swap