Reynolds Metals Company and Consolidated Subsidiaries - Page 15

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          in the open market and agreed to convert all debentures so                   
          purchased.                                                                   
               By letter dated March 4, 1987, Metals instructed Chemical               
          Bank in New York, Chemical Bank in London, S. G. Warburg & Co.,              
          Ltd., in London, and Banque Internationale a Luxembourg S.A. in              
          Luxembourg (the agents), that any debentures surrendered to them             
          for conversion "should be forwarded in the normal course to                  
          Chemical Bank in New York as principal conversion agent (not as              
          Trustee, as indicated in the letter to you dated February 24,                
          1987 from the Guarantor)."  By a second letter dated March 4,                
          1987, Metals advised Chemical Bank in New York that it had                   
          instructed all of the conversion agents "to forward all                      
          Debentures surrendered to them for conversion to Chemical Bank in            
          New York as principal conversion agent."  Metals further                     
          instructed Chemical Bank in New York that such converted                     
          debentures were to be held for the account of Metals, as provided            
          by section 4.12 of the indenture dated as of June 1, 1968.  The              
          letter to Chemical Bank also provided:                                       
                    In your role as principal conversion agent,                        
               converted Debentures held for the account of the                        
               Guarantor should be surrendered for redemption to                       
               Chemical Bank as paying agent as provided by Section                    
               4.12 of the Indenture.  Chemical Bank as paying agent                   
               is further instructed to pay the redemption price                       
               ($1,000 principal amount plus $15.97 accrued interest                   
               per $1,000 Debenture) to the Guarantor on the                           
               Redemption Date, or, in the event that knowledge of                     
               conversions is not known in time to make payment on the                 
               Redemption Date, as soon as possible thereafter. * * *                  






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