Replies to post #692636 on Fannie Mae-No Politics (FNMA)

[kthomp19]

Have you an opinion whether HERA’s succession clause —which appears to transfer to Conservator “all … rights…of shareholders”— included voting rights?

I believe it absolutely does. Judge Sweeney agreed on page 14 of her Washington Federal dismissal:

as a result of the conservatorships, they were deprived of their stockholder rights, such as the rights to receive dividends or liquidation payments, or the right to vote on the management of the Enterprises

To my knowledge there hasn't been a shareholder vote since before conservatorship.

This is also why existing commons won't be able to vote on any changes to the capital structure, even those adverse to there interests, during conservatorship.

I should note I practiced law for a decade. But I am now quasi-retired. I think I have a grasp of the legal issues and have reached some early conclusions; but I would like to hear a few of your & others’ thoughts without me first muddying the waters or stepping in carelessly.

I don't have a formal law background myself. But that isn't necessary to read things like HERA or the junior pref contracts. You'd be surprised how many FnF investors haven't read either of those.