Page:United States Statutes at Large Volume 122.djvu/3801

 12 2 STA T .37 7 8PUBLIC LA W 11 0– 3 4 3 —O CT. 3 , 2008 onthesavi n g san dp ensions o f individ u a l s , and r edu c tions in losses to the F ederal G overn m ent .(2)AUTHORI T Y . —I n carr y ing out paragraph ( 1 ), the S ec - retary shall— (A) hold the assets to maturity or for resale for and until such time as the Secretary determines that the mar k et is optimal for selling such assets, in order to ma x i- mi z e the value for taxpayers and ( B ) sell such assets at a price that the Secretary deter- mines, b ased on available financial analysis, w ill maximize return on investment for the Federal Government. ( 3 ) P RI VA T ES E C TOR P ARTICIPATIO N .— T he Secretary shall encourage the private sector to participate in purchases of troubled assets, and to invest in financial institutions, con- sistent with the provisions of this section. (b) U SEO FM AR K ET MECHANIS M S.—In making purchases under this Act, the Secretary shall— (1) make such purchases at the lowest price that the Sec- retary determines to be consistent with the purposes of this Act; and (2) maximize the efficiency of the use of taxpayer resources by using market mechanisms, including auctions or reverse auctions, where appropriate. (c) D IRECT PURCHASES.—If the Secretary determines that use of a market mechanism under subsection (b) is not feasible or appropriate, and the purposes of the Act are best met through direct purchases from an individual financial institution, the Sec- retary shall pursue additional measures to ensure that prices paid for assets are reasonable and reflect the underlying value of the asset. (d) C ON D ITIONS ON PURCHASE AUTHORITY FOR W ARRANTS AND DE B T INSTRUMENTS.— (1) IN G ENERA L .—The Secretary may not purchase, or make any commitment to purchase, any troubled asset under the authority of this Act, unless the Secretary receives from the financial institution from which such assets are to be pur- chased— (A) in the case of a financial institution, the securities of which are traded on a national securities exchange, a warrant giving the right to the Secretary to receive nonvoting common stock or preferred stock in such financial institution, or voting stock with respect to which, the Sec- retary agrees not to exercise voting power, as the Secretary determines appropriate; or (B) in the case of any financial institution other than one described in subparagraph (A), a warrant for common or preferred stock, or a senior debt instrument from such financial institution, as described in paragraph (2)(C). (2) TERMS AND CONDITIONS.—The terms and conditions of any warrant or senior debt instrument re q uired under para- graph (1) shall meet the following requirements

(A) PURPOSES.—Such terms and conditions shall, at a minimum, be designed— (i) to provide for reasonable participation by the Secretary, for the benefit of taxpayers, in equity appre- ciation in the case of a warrant or other equity security,

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