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A holder who surrendered debentures for redemption in cash
pursuant to the call would have been entitled to receive
$1,015.97, consisting of $1,000.00 principal and $15.97 accrued
interest for each $1,000.00 face value of debentures surrendered.
If a debenture holder instead exercised the right of
conversion, the holder would have been entitled to receive 22.89
shares for each $1,000 face value of debentures delivered to
Metals, pursuant to the terms of the indenture. During the
period of redemption, the market price of shares at the close of
business on the day prior to the dates on which conversions
occurred ranged from a low of $52.75 on March 4, 1987, to a high
of $65.00 on March 26, 1987. Thus, the value of the shares into
which a debenture having a face value of $1,000.00 could be
converted ranged from $1,207.45 to $1,487.85, respectively.
On February 24, 1987, Metals entered into a standby
agreement with Goldman, Sachs & Co. and Salomon Brothers Inc.
(the standby purchasers). Under the agreement, the standby
purchasers offered to purchase debentures from holders at a price
of $1,017 per $1,000 face amount until the close of business on
the redemption date. The price offered exceeded the redemption
price of $1,015.97, reflecting Metals' desire to minimize the
amount of debentures surrendered for redemption.
The standby purchasers were obligated to convert all
debentures they purchased. They could also purchase debentures
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