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Twentieth-Century Business Archives

Fruehauf Trailer Company Deal - Lehman Brothers Collection

Fruehauf Trailer Company

Company Deal60,000 shares 4 1/2% convertible preferred stock
Transaction TypeConvertible Preferred Stock Cumulative
Deal DescriptionFruehauf Trailer Company used the net proceeds from this transaction to redeem all of its outstanding 5% convertible preferred stock. The balance of the proceeds was made available for general corporate purposes, including the maintenance of cash balances, the carrying of inventories, accounts receivable, the financing of notes receivable, and future plant expansion and changes not specifically planned at that time. It was contemplated that a separate corporation (to be 100% owned by the company) may have been formed for the purpose of facilitating the financing of installment notes receivable of the company and subsidiaries. It was considered desirable at that time that the company provide itself with funds to meet possible increases of war emergency production, increased commercial business to the extent permitted by governmental restrictions, and to meet post-war responsibilities and opportunities. It was anticipated that such funds, until used or allocated for specific purposes, would be added to cash balances or invested in securities of the U.S. government.
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