| Before
|
 |
FDIC Receivership
Owns assets of Failed Bank
|
| Step 1 |
|
Receivership Conveys assets
to a Newly Established
Limited Liability Company
As Consideration for the
assets, the LLC Conveys All
Ownership Interests (Equity)
|
LLC
|
| Step 2a
|
|
Receivership Auctions a
Portion of the LLC's Equity to Qualified Bidders
Winning Bidder Pays All
Cash for its Equity Interest
|
Private
Buyer
|
| Step 2b |
|
LLC Issues Note Payable as consideration for assets
|
LLC
|
| Step 3
|
|
Receivership Auctions the
LLC's Note Payable To
Qualified Purchasers
Winning Purchaser Pays
Cash for the LLC's
Note Payable
|
Note
Investor
|
| After
|
|
FDIC Receivership
Owns Equity Interest in LLC
Has Cash from Sale of Equity
Has Cash from Sale of LLC's Note
(FDIC is required to repay note from LLC earnings before
equity holders receive any proceeds)
|
