The price also includes the preferred stock of the subsidiary.
The first is a designation for a 'class' of common or preferred stock.
Under the new deal, it will buy convertible preferred stock.
The new series of preferred stock is valued at $225 million.
The company has not paid dividends on its common and preferred stock for more than three years.
Under the deal, the dividend on the preferred stock would be about $663 million in the first year.
First Union must also pay dividends on the new preferred stock.
The bank loans are also senior to the company's common and preferred stock.
In addition, $30 million of preferred stock was sold to investors.
The offer provides a choice of some preferred stock or $2 million in cash.
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