Fannie Mae (FNMA)

[955]

Well - technically I think Treasury would sell the warrants since they are not allowed to own shares.

Since Treasury is not allowed to own shares, that would mean they could NEVER exercise the warrants. For Treasury to sell their shares, they first have to exercise the warrants which means they would be in VIOLATION of owning shares, even if only for a millisecond. If Treasury sells their shares, they would ripen plaintiffs takings claim in Judge Lamberth's court. Judge Lamberth dismissed the case because, as he stated, the plaintiff claims were not yet ripe, a taking had not yet occurred.

Treasury's only option, IMO, is to elect not to exercise warrants in the first place thereby never owning shares. Treasury's intent from the outset was never to sell the shares, but rather to drive the pps down toward zero.