A $500 price would be good if the horn was in very good playing shape.  But since you already know that it needs new pads, you could be spending around $500 for a full pad job.  There might be other issues with a horn of that age, so it could cost as much as $900 to get it in good playing shape.  For that much money, you should be able to get a nice used horn that is already in great playing shape.  
So I would pass on this horn unless you have played it and it really speaks to you.  In that case I would offer $300 and keep my fingers crossed that repair expenses would be no more than $500.