In addition, Kohlberg, Kravis has exchanged $200 million worth of a bridge loan it made to RJR Nabisco at the time of the buyout for $200 million of the new convertible preferred stock of RJR Nabisco Holdings. Kohlberg, Kravis said that the remaining portion of the bridge loan, about $385 million, would not be retired until $2.85 billion in cash had been made available to the company in connection with the repurchase and exchange offer for the junk bonds. Reset Feature The complex refinancing plan was necessary because these bonds included a reset feature that has become a subject of controversy. Under the terms of the buyout, RJR was obliged by April 1991 to reset the interest rate on the two issues at a level that would make them trade at 100 cents on the dollar, plus interest. The reset feature has created problems for Kohlberg, Kravis because the reset rate goes up as the price of the bonds drop.