Client Alert
Deadline Approaches For Capital Purchase Program Applications
November 10, 2008
Because of the rapidly changing conditions in the financial markets, we have established this special series of Client Alerts to advise you of the newest economic and legal developments and their wide-ranging business implications.
Last month, the U.S. Treasury Department announced a voluntary Capital Purchase Program ("CPP") to encourage U.S. financial institutions to build capital to increase the flow of financing to U.S. businesses and consumers. Publicly-held financial institutions interested in participating in the CPP must submit their applications by this Friday, November 14, 2008. Under the CPP, the Treasury will spend up to $250 billion to purchase senior preferred stock, along with warrants to purchase common stock, on standardized terms from qualifying U.S. financial institutions. The Treasury has issued a term sheet describing the CPP investments and, more recently, form documents which reflect minor modifications to the term sheet.
Click here to read our client alert summarizing key components of the program and its practical implications from a corporate and securities perspective.
If you have questions regarding the Capital Purchase Program, please contact Meredith Burbank, the principal author of the alert. You may also contact the Womble Carlyle attorney with whom you usually work or one of our Corporate and Securities Attorneys.
Womble Carlyle client alerts are intended to provide general information about significant legal developments and should not be construed as legal advice on any specific facts and circumstances, nor should they be construed as advertisements for legal services.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice within this client alert is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in a client alert.
