Fannie Mae-No Politics (FNMA)

[kthomp19]

I should also mention that because the NWS was deemed a breach of good faith & fair dealing, that the current unpaid NWS dividend that is increasing the LP may need to be adjusted downward to 10% or 12%.

This makes no sense to me. Any adjustment of the LP would have to involve Treasury, but Treasury was not a party to the case in Lamberth's court at all. Treasury was not found to have violated the implied covenant because that covenant was only between the companies and the shareholders; why would they either choose to or be forced to take any action at all regarding the LP in light of the jury verdict?

The dividend percentages are all based on LP amounts, and unpaid dividends are added to the LP. No additional shares issued.

Right. The share count was set by the original Senior Preferred Stock Certificate at 1,000,000 and has never changed.

The current state is that the NWS is still in place, but now considered "unpaid dividends" which is why the LP grows by the entire net worth amount dollar for dollar. It's the same mechanism as above- in lieu of cash, the unpaid amount increases the LP.

Kind of, except that the LP increase is FnF's increase in net worth as opposed to the pre-NWS world when it was a percentage of the LP.