Delta and Kappa both wish to borrow $50m.

Delta can borrow at a fixed rate of 12% or at a floating rate of the risk-free rate +3%

Kappa can borrow at 15% fixed or the risk-free rate +4%.

Delta wishes a variable rate loan and Kappa a fixed rate loan The bank for the two companies suggests a swap arrangement The two companies agree to a swap arrangement, sharing savings equally

What is the effective swap rate for each company?