I'm catching up on my DealBook, and I caught this article on leaving TARP.
The repurchase of preferred stock is easy to price, but the warrants are more difficult to value. However, using Black-Scholes a reasonable approximation of the value can be made. Basically, there is enough leeway in the assumptions made about pricing and the conditions on the warrants, that the range could be very large for prices that are fair for both parties.
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