Portuguese - ADM

Item 7.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDRESULTS OF OPERATIONS (Continued)increase in the conversion rate, subject to a stated maximum amount. In addition, in the event of a change incontrol, the holders may require the Company to purchase all or a portion of their Notes at a purchase price equal to100% of the principal amount of the Notes, plus accrued and unpaid interest, if any.Concurrent with the issuance of the Notes, the Company purchased call options in private transactions at a cost of$299 million. The purchased call options allow the Company to receive shares of its common stock and/or cashfrom the counterparties equal to the amounts of common stock and/or cash related to the excess of the currentmarket price of the Company’s common stock over the exercise price of the purchased call options. In addition, theCompany sold warrants in private transactions to acquire, subject to customary anti-dilution adjustments, 26.3million shares of its common stock at an exercise price of $62.56 per share and received proceeds of $170 million.If the average price of the Company’s common stock during a defined period ending on or about the respectivesettlement dates exceeds the exercise price of the warrants, the warrants will be settled, at the Company’s option, incash or shares of common stock. The purchased call options and warrants are intended to reduce the potentialdilution upon future conversions of the Notes by effectively increasing the initial conversion price to $62.56 pershare.Upon closing of the sale of the Notes, $370 million of the net proceeds from the Note issuance and the proceedsfrom the warrant transactions were used to repurchase 10.3 million shares of the Company’s common stock underthe Company’s stock repurchase program.As of June 30, 2007, none of the conditions permitting conversion of the Notes had been satisfied. In addition, asof June 30, 2007, the market price of the Company’s common stock was not greater than the exercise price of thepurchased call options or warrants.Contractual Obligations and Off-Balance Sheet ArrangementsIn the normal course of business, the Company enters into contracts and commitments which obligate the Companyto make payments in the future. The following table sets forth the Company’s significant future obligations by timeperiod. Purchases include commodity-based contracts entered into in the normal course of business, which arefurther described in Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” energy-relatedpurchase contracts entered into in the normal course of business, and other purchase obligations related to theCompany’s normal business activities. Where applicable, information included in the Company’s consolidatedfinancial statements and notes is cross-referenced in this table.31