What is a non consolidation opinion?

What is a non consolidation opinion?

A non-consolidation opinion states that if one or more parent entities of the SPE files for bankruptcy, the bankruptcy court would respect the separate legal existence of the SPE and would not order the substantive consolidation of the assets and liabilities of the SPE with those of one or more of its parent entities.

What is a non consolidation agreement?

A NonCon is essentially an insurance policy written by a lawyer against the likelihood that a borrower’s asset (which secures a large loan) would be taken away by a bankruptcy court in the event of a related entity’s bankruptcy (“non consolidation” – get it?).

What is substantive consolidation?

Substantive consolidation is an equitable doctrine that permits a bankruptcy court, under certain circumstances, to disregard distinctions between parent companies, subsidiaries and affiliates that operate together as a corporate group.

What is an authority to file opinion?

The California Supreme Court and Court of Appeal are state agencies authorized to request opinions. Requests should come from the chief justice or a presiding justice of the court or, as is usually the case, be submitted by the Administrative Office of the Courts.

What is a Noncon opinion?

Nonconsolidation Opinion means an opinion of counsel selected by Borrower (or other applicable Person) and reasonably satisfactory to Lender, which shall be independent outside counsel, addressed to the Rating Agencies (or which expressly permits reliance by the Rating Agencies) and Lender, in form and substance …

What is substantive consolidation chapter 11?

Substantive consolidation is the pooling of the assets and liabilities of technically distinct corporate entities. For the purposes of confirming a Chapter 11 plan or for liquidating assets under Chapter 7, the creditors of the previously distinct subsidiaries are creditors of a single debtor.

What is a non debtor entity?

Non-Debtor Subsidiaries Non-Debtor means any direct or indirect subsidiary or Affiliate of the Debtors that is not one of the Debtors.

What is a non dissolution opinion?

Non-dissolution opinion – This opinion states that the SPE has one or more directors on its board who are not related (by business or personal relationships) to those who own the business. When determining if a company should declare bankruptcy, a majority of the board must vote to take this action.

What is a recycled SPE?

Related to Recycled SPE Borrower/SPE Component Entity. Mezzanine Borrower shall have the meaning set forth in Section 11.6 hereof. SPE means any special purpose Unrestricted Subsidiary established in connection with any Accounts Receivable Securitization.

Who can write a legal opinion letter?

A legal opinion is a common form of formal communication between lawyer and client and sometimes lawyer and lawyer. Legal opinion is delivered as a letter popularly known as ‘Legal opinion letter’. This letter always contains factual analysis and application of the law basing on those facts/issues.

How do I write an opinion letter?

Make sure your letter includes:

1. the date it was written.
2. a salutation or greeting (who the letter is to)
3. an introduction explaining your topic and opinion.
4. a body with reasons that support your opinion.
5. a conclusion restating your opinion or telling why it is important.
6. closing.
7. your signature.

What is a nonconsolidation opinion letter?

Nonconsolidation Opinion means the opinion letter, dated as of the date hereof, delivered by Borrower ’s counsel to Lender and addressing issues relating to substantive consolidation in bankruptcy.

How do you use non consolidation in a sentence?

Examples of Nonconsolidation Opinion in a sentence. If any of the assumptions contained in the Non-consolidation Opinion, or in any other “non-consolidation” opinion delivered to Lender in connection with the Loan, or in any other “non-consolidation” opinion delivered subsequent to the Loan, is or shall become untrue in any material respect.

Can a bankruptcy court order a substantive consolidation of an asset?

The letter’s content is negotiated with a lawyer who represents the lender, and when finalized concludes with the firm statement that a bankruptcy court “will not” order the substantive consolidation of the borrower’s asset with a related entity’s bankruptcy estate. (And if you know lawyers, we don’t usually say things like “will not.”