EFTA02374085.pdf

From: Sent: Tuesday, May 24, 2011 1:10 PM To: jeevacation@gmail.com Subject: Re: I am meeting Swanson again on Thursday. H=re is the state of play. In our meeting Saturday he was ok with 18% for 1 year (to dovetail wi=h theextended term of the first) with such security arrangements beside th= mortgage (new LLC or amended LLC operating agreement) as were acceptable =o you and TD. I also mentioned a point or point and a half. If you agree, I t=ought this could fund an upfront fee for me. He said he was concerned about renegotiating the existing subordination agr=ement between TD and Kosoy (it evidently took a long time) and wanted some=time to think through it and perhaps talk to TD. (The team dealing with hi= is in transition in part because TD is moving out the old Mercantile peop=e.) He also was agreeable to sharing a percentage of the profit which I l=kened to the deals he does with backers who earn a guaranteed return and S=%. He noted that he had put all the capital up and seemed to suggest a pro=rata alloocation based on your $10M compared to the amount he has in =net of what he borrowed out (We'll see what that looks like.) I tied that =o adding me or an entity as a member of the LLC which is also necessary gi=en the operating agreement provisions which we are considering. He asked for some time to think things through and we are to meet again on =hursday late afternoon. I am sure he is considering his alternatives (if a=y) too. He also wanted time to think about the issues I raised about the 11.0 operat=ng agreement (whether a new LLC or amending the existing operating agreeme=t.). These were requiring unanimous consent for: seeking bankruptcy protec=ion, adding new members, creating new debt, refinancing existing debt, or =urther amendment. The OA would also provide for his removal as a man=ger on default under either mortgage. An open point is whether unani=ity should be required to agree to a sale of the house. I was thinking set=ing an agreed value range. An entity (trust or other LLC) would beco=e a member with that percentage still under negotiation. I am sure he is also thinking about the percentage of the LLC interest to o=fer. I asked about the existing LLC. He confirmed it was a single asset, single =ember LLC with no significant other debt outside of the ordinary course (m=intenance). The member is a trust fbo him and his wife. As you know, taxes= insurance and interest are reserved and TD would require the same for any=extended term. Dan expects some increase in real estate taxes next year (a=sessments come out over the summer).The 2010 tax appraisal is $7,497,000 v= $13,611,000 in 2008. He paid $20,800,000 in August 2007 (plus commission =ay $21,600,000.) He says he has had good results working with the appraise=s office. We'll see. I asked him to involve his accountant about the income tax consequences of =ransferring the house to a new LLC or adding a member and also the outstan=ing liabilities and payables of the LLC. I have a follow up call with a bankruptcy lawyer today on the enforceabilit= of the protections we are discussing. Swanson wants to close by the end of June. Please let me know what you are thinking. EFTA_R1_01380634 EFTA02374085 From: Jeffrey Epstein <jeevacation@gmail.com> To: paul prosperi Sent: Tue, May 24, 2011 7:10 am news? The information contained in this communication is confidential, may be attorney-client privileged, may constitute inside information, and is intended only for the use of the addressee. It is the property of Jeffrey Epstein Unauthorized use, disclosure or copying of this communication or any part thereof is strictly prohibited and may be unlawful. If you have received this communication in error, please notify us immediately by return e-mail or by e-mail to jeev=cation@gmail.com <mailto:jeevacation@gmail.com> , and destroy this communication and all copies thereof, including all attachments. copyright -all rights reserved 2 EFTA_R1_01380635 EFTA02374086