and to the redemption of the rights issued to shareholders under the newly adopted Rights Plan. The Revlon board responded by advising shareholders to reject the offer as inadequate, and it commenced its own offer to repurchase a significant percentage of its own outstanding shares in exchange for senior subordinated notes and convertible preferred stock valued at $100 per share. The offer was quickly oversubscribed and in exchange for 10 million of its own tendered shares, the company issued notes that contained covenants restricting Revlon's ability to incur debt, sell assets or issue dividends going forward. The successful consummation of the Revlon repurchase program effectively thwarted Pantry Pride's outstanding tender offer. A few weeks later, however, Pantry Pride issued a new one that, taking into account the completed exchange offer, reflected value essentially equivalent to its first offer. Following rejection of this offer by the Revlon board, Pantry Pride repeatedly revised its offer over the course of the next several weeks, raising the offer price to $50, and later to $53 per share. During this same period, the Revlon board had commenced discussions with Forstmann, Little regarding a possible leveraged buyout led by Forstmann as an alternative to the acquisition by Pantry Pride. It quickly reached agreement in principle on a transaction at a price of $56. The terms of the proposed deal importantly included a waiver of the restrictive covenants contained in the notes issued by Revlon in the earlier repurchase. The announcement of the proposed deal, and in particular the anticipated waiver of the covenants, sent the trading value of the notes into a steep decline, engendering threats of litigation from now irate noteholders. Pantry Pride promptly raised the price of its offer to $56.25 per share. It further announced publicly that it would top any ensuing bid that Forstmann might make, if only by a fraction. In light of this, Forstmann expressed reluctance to reenter the bidding without significant assurances from Revlon that any resulting deal would close. The Revlon board assuaged Forstmann's concern. Less than a week following Pantry Pride's $56.25 offer, it struck a deal with Forstmann pursuant to which Forstmann would pay $57.25 per share conditioned on its receipt of a lock-up option to purchase one of Revlon's important business divisions at a discounted price should another acquirer secure 40% or more of Revlon's outstanding stock, a $25 million termination fee, a restrictive no-shop