FNMA and FMCC preferreds. In search of the elusive 10 bagger.

[Midas79]

One remedy the Collins plaintiffs suggested, as a way to unwind the NWS, was for Treasury to send $125B to FnF and keep the seniors. Treasury would then presumably convert the seniors to commons (basically super-warrants) to recoup that money and then some. The warrants themselves would be superfluous at that point.

 

These two actions taken together amount to an instant recap for FnF. Core capital was negative $170B at the end of 2019. Add $125B to that for the cash payment and another $193B for the senior-to-common conversion. Suddenly core capital is positive $148B, which is higher than the greater of Watt's two alternative minimum capital standards of $103.5B and $139.5B.

 

I believe this would also instantly moot all the NWS lawsuits seeking injunctive relief because the cash payment represents a return to what things would have been like without the NWS, and the conversion means the NWS is gone going forward because the NWS dividends were always paid to the holders of the seniors, which would no longer exist. It should also moot all derivative claims in Sweeney's court. There would be no need to settle these cases, would there?

 

This provides FnF with enough capital to take whatever measures FHFA, and presumably Treasury as a condition of agreeing to this course of action, deems necessary to support the housing market. With $2T already having been spent, an extra $125B (which will come back with interest when Treasury unwinds its converted-senior common stake) shouldn't be politically difficult.

 

I'm trying to see what I am missing here, but this seems to check all the boxes.

[DRValue]

One remedy the Collins plaintiffs suggested, as a way to unwind the NWS, was for Treasury to send $125B to FnF and keep the seniors. Treasury would then presumably convert the seniors to commons (basically super-warrants) to recoup that money and then some. The warrants themselves would be superfluous at that point.

 

These two actions taken together amount to an instant recap for FnF. Core capital was negative $170B at the end of 2019. Add $125B to that for the cash payment and another $193B for the senior-to-common conversion. Suddenly core capital is positive $148B, which is higher than the greater of Watt's two alternative minimum capital standards of $103.5B and $139.5B.

 

I believe this would also instantly moot all the NWS lawsuits seeking injunctive relief because the cash payment represents a return to what things would have been like without the NWS, and the conversion means the NWS is gone going forward because the NWS dividends were always paid to the holders of the seniors, which would no longer exist. It should also moot all derivative claims in Sweeney's court. There would be no need to settle these cases, would there?

 

This provides FnF with enough capital to take whatever measures FHFA, and presumably Treasury as a condition of agreeing to this course of action, deems necessary to support the housing market. With $2T already having been spent, an extra $125B (which will come back with interest when Treasury unwinds its converted-senior common stake) shouldn't be politically difficult.

 

I'm trying to see what I am missing here, but this seems to check all the boxes.

 

I have commented this before. Personally I dontt really see another way of definitely getting rid of all the lawsuits. And the instant recap takes so much time and work out of this while at the same time solving many problems. 

[Guest cherzeca]

if I was Houlihan Lokey, I would put this check writing by treasury option at the bottom of the list

[Midas79]

if I was Houlihan Lokey, I would put this check writing by treasury option at the bottom of the list

 

I think the idea would have to originate with Treasury, not FHFA. But why would HL not like this option?

[allnatural]

I think we would all love (unless you own common) for the Treasury to write a $125b check to the GSEs and simply convert their senior pfds to common, bypass an IPO all together, and slowly do secondary offerings on their snr pfd common + warrant stake over the coming years.

 

It just seems a much more palatable solution is to write down the senior pfds to zero, and give the GSEs a "future tax (or commitment fee) credit" of ~$30b that can be deemed capital for balance sheet purposes. Zero $ out of pocket. Regardless of how much money the government is dishing out right now, I would think writing a $125b cash check would be difficult in any environment (vs the alternative of zero $ outflow).

 

But I hope you turn out correct!

[Guest cherzeca]

if I was Houlihan Lokey, I would put this check writing by treasury option at the bottom of the list

 

I think the idea would have to originate with Treasury, not FHFA. But why would HL not like this option?

 

not really a live option, so why mention it as a possibility, except to show that you were thorough

[Midas79]

if I was Houlihan Lokey, I would put this check writing by treasury option at the bottom of the list

 

I think the idea would have to originate with Treasury, not FHFA. But why would HL not like this option?

 

not really a live option, so why mention it as a possibility, except to show that you were thorough

 

Why is it not a live option? I just want to hear the argument against it, if for no other reason than to assure myself that it isn't a possibility. A senior cramdown is not great for the prefs compared to a share exchange followed by the re-IPO anyway.

 

I don't see a reason why Treasury would have to send the $125B in cash, by the way. If the $25-30B overpayment could be "returned" by giving FnF that much credit against future taxes and commitment fees, while still increasing core capital (perhaps it would be booked as a prepaid tax/fee asset in the asset section of the balance sheet and an increase to retained earnings in the equity section), then why couldn't the $125B be treated the same way?

 

And if that form of overpayment return doesn't count towards core capital (whether it's $25-30B or $125B) then ACG is wrong about it reducing the size of the offering.

 

I'm playing devil's advocate here. I don't think this senior cramdown will or even should happen, but I can't yet convince myself that it's completely off the table. It allows for a much, much faster recap than the re-IPO route.

[investorG]

A $125bn check is unlikely but a $[50b]n infusion along with sr pref repaid + warrant exercise (essentially creating a strike price of ~$6) + lawsuit removal + shelve release plans until crisis passes is a solid idea.  that would give them $75bn plus some potential 2020 retained earnings = ~$100bn capital to address the crisis head on and help Americans (including servicers).  it's effectively reinvesting half of their sr pref profits into common equity with the potential for additional proceeds from secondary sales in out years.

[Midas79]

A $125bn check is unlikely but a $[50b]n infusion along with sr pref repaid + warrant exercise (essentially creating a strike price of ~$6) + lawsuit removal + shelve release plans until crisis passes is a solid idea.  that would give them $75bn plus some potential 2020 retained earnings = ~$100bn capital to address the crisis head on and help Americans (including servicers).  it's effectively reinvesting half of their sr pref profits into common equity with the potential for additional proceeds from secondary sales in out years.

 

I have to admit, I don't know what you're talking about here. Treasury already has warrants for 79.9% of the common, what more do they get for "reinvesting half of their sr profits"? 95%? And what does the "infusion" have to do with the warrants?

[WB_fan82]

One remedy the Collins plaintiffs suggested, as a way to unwind the NWS, was for Treasury to send $125B to FnF and keep the seniors. Treasury would then presumably convert the seniors to commons (basically super-warrants) to recoup that money and then some. The warrants themselves would be superfluous at that point.

 

These two actions taken together amount to an instant recap for FnF. Core capital was negative $170B at the end of 2019. Add $125B to that for the cash payment and another $193B for the senior-to-common conversion. Suddenly core capital is positive $148B, which is higher than the greater of Watt's two alternative minimum capital standards of $103.5B and $139.5B.

 

I believe this would also instantly moot all the NWS lawsuits seeking injunctive relief because the cash payment represents a return to what things would have been like without the NWS, and the conversion means the NWS is gone going forward because the NWS dividends were always paid to the holders of the seniors, which would no longer exist. It should also moot all derivative claims in Sweeney's court. There would be no need to settle these cases, would there?

 

This provides FnF with enough capital to take whatever measures FHFA, and presumably Treasury as a condition of agreeing to this course of action, deems necessary to support the housing market. With $2T already having been spent, an extra $125B (which will come back with interest when Treasury unwinds its converted-senior common stake) shouldn't be politically difficult.

 

I'm trying to see what I am missing here, but this seems to check all the boxes.

 

Only thing is whether there is an obstacle to owning > 80% of the GSEs, since this conversion would put the government at nearly 100% ownership.  From my notes, the government went > 80% in AIG so it should be doable.  But presumably the warrant was limited at 79.9% for some reason.

 

Second, with a potential new TSY sec in 2021 does Treasury ever decide to sell their controlling stake?  Controlling all the votes isn't that far removed from being under government control in c-ship.

 

TSY doesn't need to convert to common to fill up the equity capital account.  They can also just amend the preferred to take away the cumulative feature.  That would qualify the entire senior preferred as capital, similar to the junior prefs.

 

[Guest Covid-19_Survivor]

I'll be honest about this site. It would be more beneficial to everyone, that is subscribers, lurkers, and investment accounts all, if every likely scenario introduced didn't conclude with 'to the moon'.

 

Chances are we'll be fine (I've thought this for a decade) but to those who understand the details far better than we do, how about a thread on what's most likely to happen? Put yourselves in Treasury's position.

 

Because I'll guarantee to you that none of your shit's gonna happen.

 

Think of how:

1) "taxpayers are protected" (LOL)

2) FnF is efficient as a backstop

3) hedgefunds don't get away with raping taxpayers

4) Treasury gets PAID

 

That's the answer.

 

[orthopa]

I'll be honest about this site. It would be more beneficial to everyone, that is subscribers, lurkers, and investment accounts all, if every likely scenario introduced didn't conclude with 'to the moon'.

 

Chances are we'll be fine (I've thought this for a decade) but to those who understand the details far better than we do, how about a thread on what's most likely to happen? Put yourselves in Treasury's position.

 

Because I'll guarantee to you that none of your shit's gonna happen.

 

Think of how:

1) "taxpayers are protected" (LOL)

2) FnF is efficient as a backstop

3) hedgefunds don't get away with raping taxpayers

4) Treasury gets PAID

 

That's the answer.

 

To the moon is fun to think about but I think it is being brought up because as unlikely as it is, its most likely to occur during a time of stress.

 

The preferred can trade to par and all of your criteria can be met and to me this is all that matters for my investment. The common is less clear as it always has been.

[Luke 532]

To the moon is fun to think about but I think it is being brought up as unlikely as it maybe its most likely to occuring during a time of stress.

 

The preferred can trade to par and all of your criteria can be met and to me this is all that matters for my investment. The common is less clear as it always has been.

 

+1

[investorG]

I'll be honest about this site. It would be more beneficial to everyone, that is subscribers, lurkers, and investment accounts all, if every likely scenario introduced didn't conclude with 'to the moon'.

 

Chances are we'll be fine (I've thought this for a decade) but to those who understand the details far better than we do, how about a thread on what's most likely to happen? Put yourselves in Treasury's position.

 

Because I'll guarantee to you that none of your shit's gonna happen.

 

Think of how:

1) "taxpayers are protected" (LOL)

2) FnF is efficient as a backstop

3) hedgefunds don't get away with raping taxpayers

4) Treasury gets PAID

 

That's the answer.

 

Good points but this post won't be popular among the dreamers.  It's important that Mnuchin gets capital into FnF asap given the magnitude of this crisis but one thing he'll surely avoid is a stock windfall before the election.  That balance can be achieved imo in prior thoughts I've posted.

[Guest cherzeca]

so optics aside, treasury sending $120B (senior pref balance) plus some more for the overage dividends in exchange for settlement of litigation would recap Fannie, though I believe the optics of treasury writing a big check to settle litigation are not good.  perhaps it could be spun as a recap move.

 

but how can treasury go above 80% ownership of Fannie by exchanging common for its senior pref?  that would put Fannie's $3T of liabilities on the govt balance sheet.  I suspect that would violate the debt ceiling limit that was raised last year after a contentious fight in congress.  and while treasury has authority to purchase securities under HERA, I dont know that settling litigation with a huge cash payment would be authorized and considered appropriated.

 

of course, the senior pref can stay outstanding and get sold off over time though exchanges into common prior to secondary sale by treasury, which would avoid the consolidation of Fannie's debt on the US balance sheet.  I suppose that could be made to work, change the NWS into something fair, leave it outstanding for now, and then have treasury sell it off through a series of for-common exchanges and sales.

[Midas79]

so optics aside, treasury sending $120B (senior pref balance) plus some more for the overage dividends in exchange for settlement of litigation would recap Fannie, though I believe the optics of treasury writing a big check to settle litigation are not good.  perhaps it could be spun as a recap move.

 

but how can treasury go above 80% ownership of Fannie by exchanging common for its senior pref?  that would put Fannie's $3T of liabilities on the govt balance sheet.  I suspect that would violate the debt ceiling limit that was raised last year after a contentious fight in congress.  and while treasury has authority to purchase securities under HERA, I dont know that settling litigation with a huge cash payment would be authorized and considered appropriated.

 

of course, the senior pref can stay outstanding and get sold off over time though exchanges into common prior to secondary sale by treasury, which would avoid the consolidation of Fannie's debt on the US balance sheet.  I suppose that could be made to work, change the NWS into something fair, leave it outstanding for now, and then have treasury sell it off through a series of for-common exchanges and sales.

 

1) Perhaps Treasury can give FnF a credit of $125B rather than sending a check, similar to the idea that they would give FnF a $25-30B credit in the seniors-extinguished remedy. It could also be an arrangement where Treasury sends FnF 80% (or some other number) of all cash proceeds from the sale of its (converted from senior) common stock up to $125B. That would guarantee Treasury a profit. I don't know if this liability would count towards the debt ceiling, though.

2) Treasury had a 92% stake in AIG at one point and I don't think they had to consolidate AIG's balance sheets onto the government's, though I could be wrong. Does anyone here have knowledge of how that transaction was structured?

3) Treasury should easily be able to structure a senior conversion to avoid 80% ownership, or even 50% if controlling shareholder issues matter. One option is to convert the seniors to convertible non-cumulative prefs (which count towards core capital), but with a provision that Treasury can convert them to commons at any time up to a specified date, at which point the conversion to common would be forced. This allows for an easy piecemeal conversion over time that gives Treasury an eventual 99.5% common stake (or whatever number is enough to recoup the $125B plus whatever the warrants would have brought in) but doesn't ever trigger the 80% or 50% thresholds.

 

The unwinding of Treasury's stake basically is the re-IPO here, but this resolution allows for immediate release (because FnF would be fully capitalized), or at the very least before the election. Releasing FnF and getting rid of the seniors (and thus the NWS) are the two major irreversible steps this administration can take.

 

Incidentally, this scenario answers the questions of how Treasury gets paid and how hedge funds don't make a huge windfall. The juniors do go to par here, but I don't see a recap/release scenario that doesn't involve this. Maybe FHFA and Treasury can strong-arm the juniors into accepting a "haircut" exchange for commons (at less than par) as a condition for going through with recap and release at all?

[Guest cherzeca]

"Treasury had a 92% stake in AIG at one point and I don't think they had to consolidate AIG's balance sheets onto the government's, though I could be wrong. Does anyone here have knowledge of how that transaction was structured?"

 

maybe it was a pro forma 92%, giving effect to a subsequent exchange like I suggest in my post.  GAAP would require >80% common shareholder to consolidate with issuer.

[Guest cherzeca]

@midas

 

does treasury have the legal authority to write this check?  under HERA, last time I checked and not having looked at it again, treasury has authority to purchase securities.  does it also have authority to settle litigation with respect to a security it has purchased?  one could argue that treasury has the authority to enter into this settlement since it is in respect of a security it has purchased (senior pref), much as treasury had the authority to change the terms of the senior pref in the 3rd A

[orthopa]

so optics aside, treasury sending $120B (senior pref balance) plus some more for the overage dividends in exchange for settlement of litigation would recap Fannie, though I believe the optics of treasury writing a big check to settle litigation are not good.  perhaps it could be spun as a recap move.

 

but how can treasury go above 80% ownership of Fannie by exchanging common for its senior pref?  that would put Fannie's $3T of liabilities on the govt balance sheet.  I suspect that would violate the debt ceiling limit that was raised last year after a contentious fight in congress.  and while treasury has authority to purchase securities under HERA, I dont know that settling litigation with a huge cash payment would be authorized and considered appropriated.

 

of course, the senior pref can stay outstanding and get sold off over time though exchanges into common prior to secondary sale by treasury, which would avoid the consolidation of Fannie's debt on the US balance sheet.  I suppose that could be made to work, change the NWS into something fair, leave it outstanding for now, and then have treasury sell it off through a series of for-common exchanges and sales.

 

1) Perhaps Treasury can give FnF a credit of $125B rather than sending a check, similar to the idea that they would give FnF a $25-30B credit in the seniors-extinguished remedy. It could also be an arrangement where Treasury sends FnF 80% (or some other number) of all cash proceeds from the sale of its (converted from senior) common stock up to $125B. That would guarantee Treasury a profit. I don't know if this liability would count towards the debt ceiling, though.

2) Treasury had a 92% stake in AIG at one point and I don't think they had to consolidate AIG's balance sheets onto the government's, though I could be wrong. Does anyone here have knowledge of how that transaction was structured?

3) Treasury should easily be able to structure a senior conversion to avoid 80% ownership, or even 50% if controlling shareholder issues matter. One option is to convert the seniors to convertible non-cumulative prefs (which count towards core capital), but with a provision that Treasury can convert them to commons at any time up to a specified date, at which point the conversion to common would be forced. This allows for an easy piecemeal conversion over time that gives Treasury an eventual 99.5% common stake (or whatever number is enough to recoup the $125B plus whatever the warrants would have brought in) but doesn't ever trigger the 80% or 50% thresholds.

 

The unwinding of Treasury's stake basically is the re-IPO here, but this resolution allows for immediate release (because FnF would be fully capitalized), or at the very least before the election. Releasing FnF and getting rid of the seniors (and thus the NWS) are the two major irreversible steps this administration can take.

 

Incidentally, this scenario answers the questions of how Treasury gets paid and how hedge funds don't make a huge windfall. The juniors do go to par here, but I don't see a recap/release scenario that doesn't involve this. Maybe FHFA and Treasury can strong-arm the juniors into accepting a "haircut" exchange for commons (at less than par) as a condition for going through with recap and release at all?

 

If we are to believe what Calabria/Mnuchin have said, as well as the steps they have taken so far then we have to believe at some point FnF will be recapped and released. I agree dont really see a scenario where preferred does not go to par or is compensated in some way if a hair cut is taken.  That being said 4-500% still can be made via some preferred. Crazy.

 

Question to those on the board. Which step taken in the future will give the biggest push to preferred?

 

1. Capital rule in late May?

 

2. Freddie/Fannie hiring advisers?

 

3. Final PSPA admendment Fall/winter?

 

I would have to imagine they really wont pop until the most clarity is given via the final amendment. By year end capital at Fannie should be ~22-23B. If the senior preferred are gone by year end at that level of capital shouldn't the preferred trade near par or be worth par anyway? Dividends wont be turned on but the capital will be there to make the preferred worth par.

 

If that is the case there will have to be a sweetener to get preferred to convert at a haircut before that level of capital builds on the balance sheet and PSPA amended.  Otherwise why not just let the capital build and wait?

 

I think this is why some have contemplated a surprise bang/announcement where conversion is announced with a PSPA agreement based on previous 30 day trading price of common etc. Otherwise why would preferred be motivated to convert?

 

Just thinking out loud. Dont want to count chickens before they hatch but we are coming up on 7 months till end of the year and 6 to the election.

[beaufort]

Why is it not a live option? I just want to hear the argument against it, if for no other reason than to assure myself that it isn't a possibility. A senior cramdown is not great for the prefs compared to a share exchange followed by the re-IPO anyway.

 

I don't see a reason why Treasury would have to send the $125B in cash, by the way. If the $25-30B overpayment could be "returned" by giving FnF that much credit against future taxes and commitment fees, while still increasing core capital (perhaps it would be booked as a prepaid tax/fee asset in the asset section of the balance sheet and an increase to retained earnings in the equity section), then why couldn't the $125B be treated the same way?

 

And if that form of overpayment return doesn't count towards core capital (whether it's $25-30B or $125B) then ACG is wrong about it reducing the size of the offering.

 

I'm playing devil's advocate here. I don't think this senior cramdown will or even should happen, but I can't yet convince myself that it's completely off the table. It allows for a much, much faster recap than the re-IPO route.

 

I think you answered the question yourself:  a senior cramdown is not great for JPS.

 

If there is a way to make it work for JPS, I think it could work.  By making it work, I mean that JPS get a substantial minority of the future companies in common.  For that to happen, the warrants have to be exercised before the juniors are exchanged.  My unoriginal thesis is that the new money (whoever that is) plus current JPS end up with substantially all of the recapped entities, with very little left for current common holders.

 

I am unclear what the MBA and Whelan want from Fannie and Freddie.  I know they want liquidity.  I have not seen a clear articulation of what the mechanics would be to getting the liquidity, or how much.  We might be getting back to some kind of portfolio business, of the kind the GSEs were required to wind up.   

 

 

 

 

[Midas79]

@cherzeca

 

I don't think Treasury would need any additional authority to convert the seniors to either non-cumulative convertible prefs or straight to commons. I also don't think either of these would count as a new security purchase because there would be no actual purchase, but I could be wrong there. If it does then I think HERA's purchase sunset clause of 12/31/09 would scuttle the idea.

 

@orthopa

 

#3 by far. The seniors disappearing (whether extinguished or converted to common) plus FnF retaining this year's earnings should fully capitalize the juniors. At that point the juniors have no reason to accept a haircut.

 

Also, a "haircut" is just a term to make it seem like junior pref shareholders "lose". But an exchange for commons involves two variables: the % of par and the common price. The quotient of these is the number of shares each junior pref shareholder gets per share. FHFA could easily offer an exchange at 80% of par at $2, for example, even though it's equivalent to 100% of par at $2.50, and call it a "haircut". The common exchange price doesn't have to be the market average from the previous X days, it can be anything FHFA damn well pleases.

 

@beaufort

 

A senior cramdown doesn't have to be bad for the juniors, but it can be. It depends on the terms. Of course, if those terms are too unfavorable to the juniors they will just refuse and keep the shares.

 

I also think that in the end, very little of FnF will be left for existing common holders. Probably enough to make some money from here, but not as much as the prefs. That's why I don't own the commons right now.

[Guest cherzeca]

@cherzeca

 

I don't think Treasury would need any additional authority to convert the seniors to either non-cumulative convertible prefs or straight to commons. I also don't think either of these would count as a new security purchase because there would be no actual purchase, but I could be wrong there. If it does then I think HERA's purchase sunset clause of 12/31/09 would scuttle the idea.

 

@orthopa

 

#3 by far. The seniors disappearing (whether extinguished or converted to common) plus FnF retaining this year's earnings should fully capitalize the juniors. At that point the juniors have no reason to accept a haircut.

 

Also, a "haircut" is just a term to make it seem like junior pref shareholders "lose". But an exchange for commons involves two variables: the % of par and the common price. The quotient of these is the number of shares each junior pref shareholder gets per share. FHFA could easily offer an exchange at 80% of par at $2, for example, even though it's equivalent to 100% of par at $2.50, and call it a "haircut". The common exchange price doesn't have to be the market average from the previous X days, it can be anything FHFA damn well pleases.

 

@beaufort

 

A senior cramdown doesn't have to be bad for the juniors, but it can be. It depends on the terms. Of course, if those terms are too unfavorable to the juniors they will just refuse and keep the shares.

 

I also think that in the end, very little of FnF will be left for existing common holders. Probably enough to make some money from here, but not as much as the prefs. That's why I don't own the commons right now.

 

@midas

 

you are missing my point.  under what authority does treasury have to write a >$120B check to the GSEs?  this is a little removed from altering the terms of the senior pref, n'est-ce pas?

[orthopa]

http://www.mortgagenewsdaily.com/04152020_covid_19_responses.asp

 

Calabria teaming up with CFPB to make sure no funny business with servicers. He is really laying the lumber to the MBA, Chris Whalen, Dave Stevens crowd. No love lost there.

[orthopa]

https://www.marketwatch.com/story/fannie-mae-home-sales-will-decline-by-nearly-15-in-2020-due-to-coronavirus-2020-04-15?mod=home-page

 

Home prices projected to be steady/increase this year making it less likely home owners will walk away ie default. Good so far for FnF.

[Guest Covid-19_Survivor]

I'll be honest about this site. It would be more beneficial to everyone, that is subscribers, lurkers, and investment accounts all, if every likely scenario introduced didn't conclude with 'to the moon'.

 

Chances are we'll be fine (I've thought this for a decade) but to those who understand the details far better than we do, how about a thread on what's most likely to happen? Put yourselves in Treasury's position.

 

Because I'll guarantee to you that none of your shit's gonna happen.

 

Think of how:

1) "taxpayers are protected" (LOL)

2) FnF is efficient as a backstop

3) hedgefunds don't get away with raping taxpayers

4) Treasury gets PAID

 

That's the answer.

 

To the moon is fun to think about but I think it is being brought up because as unlikely as it is, its most likely to occur during a time of stress.

 

The preferred can trade to par and all of your criteria can be met and to me this is all that matters for my investment. The common is less clear as it always has been.

 

Our juniors could also trade less than par.

 

Who says seniors must be extinguished? AFAIC, all the treasury needs to do is find a way to reimburse us for the $118 mil it stole. But seniors could be amended and IPO'd @ say 8%. We wouldn't want to but FnF could deal with that $16 bil/yr. And that $118 bil credit (or whatever) would become core capital, resolving everything except warrants. They could safely be extinguished because 1) it would historically consistent to do so, and 2) 90% of Congress doesn't even know what a warrant is.

 

And there's no rule that says we must be converted to commons. They could just tell the hedgefunds to get bent, you're non-cumulative. Reject deal at your own risk.

 

FIXED, and we're nowhere near 25/50

 

Probably not but come on, the very clear future we see for ourselves seems to have a few holes. 1 year 5 bagger on most.