A New Zealand based company has issued floating-rate notes with a maturity of 10 years, the interest of a six-month LIBOR plus 35 basis points, and a total face value of $10 million. The company now believes that interest rates will rise and wishes to protect itself against higher interest rates by entering into an interest rate swap. A dealer provides a quote on a 10-year swap whereby the company will pay a fixed rate of 7% p.a and receive six-month LIBOR. Interest is paid semiannually. Assume the current LIBOR rate is 5% p.a. Indicate how the company can use a swap to convert the debt to a fixed rate. Calculate the first net payment between the dealer and the company and indicate which party makes the payment. Assume that all payments are semimanual and made based on 180/360.