Variable Interest Entity Clause Samples
A Variable Interest Entity (VIE) clause defines the criteria and conditions under which an entity is considered a VIE for accounting or regulatory purposes. This clause typically outlines the factors that determine whether a company has a controlling financial interest in another entity, such as through contractual arrangements or financial support, even if it does not own a majority of voting rights. By clarifying when an entity must be consolidated in financial statements, the clause ensures transparency and compliance with accounting standards, addressing the risk of off-balance-sheet arrangements.
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Variable Interest Entity. Seller shall supply Buyer with any information necessary for the Buyer to determine if the Seller is a variable interest entity as defined under U.S. Generally Accepted Accounting Principles, and to determine if this Agreement is a lease under U.S. Generally Accepted Accounting Principles. If it is determined that the Seller is a variable interest entity and that Buyer will be required to include Seller in its consolidated financial statements or required to make certain disclosures, or that this Agreement is a lease, Buyer shall so notify Seller in writing. Within a time frame mutually agreed to by ▇▇▇▇▇ and Seller, Seller shall provide to Buyer written quarterly reports containing any and all financial data associated with the Seller and the Plant associated with this Agreement or any other information that the Buyer determines in its sole discretion is required to comply with the accounting treatment associated with these accounting standards or future applicable accounting standards. Such information may include, but shall not be limited to, nameplate capacity of the facility, megawatt-hours of electricity produced and used by the Plant, data supporting the economic life (both initial and remaining) of the Plant, the fair market value of the Plant, and any and all other costs (including costs of debt specific to the Plant) associated with the Seller. Further, if it is determined that the Seller is a variable interest entity and that Buyer will be required to include Seller in its consolidated financial statements, Seller shall also provide the following on a quarterly basis:
(i) Quarterly financial statements prepared in accordance with generally accepted accounting principles;
(ii) Descriptions of the following obligations of Seller for the immediately preceding calendar quarter:
(A) On-balance sheet obligations;
(B) Purchase obligations;
(C) Lease obligations and commitments;
(D) Off-balance sheet commitments; and
(E) Contingent obligations;
(F) Total generating capacity;
(iii) All material contracts (or summaries if the original contracts are not immediately available) of Seller then in effect, together with any related agreements, if any, including, but not limited to:
(A) Equity-related agreements;
(B) Debt and other borrowings;
(C) Material asset or stock acquisitions or dispositions;
(D) Documents under which guarantees or indemnities have been provided;
(E) Material supplier and customer contracts;
(F) Related-party contracts;
(G) Documents rel...
Variable Interest Entity. Create or establish any Variable Interest Entity other than any Person that solely as a result of change in GAAP, becomes a Variable Interest Entity; provided that no Sharing Arrangement shall exist between such Person and a Covenant Entity.
Variable Interest Entity. 13.4.1 Within five (5) Days after the Effective Date and thereafter prior to the commencement of the Initial Period and each Annual Period of the Term, QF shall provide Alabama Power with the Variable Interest Entity (“VIE”) information in the form of Appendix F attested to and signed by a duly authorized officer of QF. QF covenants to promptly notify Buyer following any determination made by QF or its independent auditor that QF must be partially or fully deconsolidated from the books of QF’s parent, as the case may be, or any other changes that require reconsideration, including a change in the primary benefactor. Should existing accounting standards be modified or new standards adopted which supersede the standards at the time of execution of this Agreement, then Appendix F shall be modified accordingly for QF and Alabama Power to account for this arrangement appropriately in their respective books and records.
13.4.2 In the event that ▇▇▇▇▇’s independent accountants determine that consolidation of QF, or any of its Affiliates or permitted assigns, as a VIE in Alabama Power’s or any of its Affiliates’ financial statements has occurred, Alabama Power may provide notice to QF of such condition. In addition, within ten (10) Business Days after receiving any such notice, QF shall provide all necessary financial information to Alabama Power to enable Alabama Power (and any of its applicable Affiliates) to properly consolidate QF (and any of its applicable Affiliates) on a timely basis.
Variable Interest Entity. Seller shall supply Buyer with any information necessary for the Buyer to determine (acting reasonably and in consultation with Seller) if the Seller is a variable interest entity as defined by Financial Accounting Standards Board Accounting Standards Codification Topic 810, Consolidations, and to determine (acting reasonably and in consultation with Seller) if this Agreement is a lease in accordance with Accounting Standards Codification Topic 842, Leases. If it is determined that the Seller is a variable interest entity and that Buyer will be required to include Seller in its consolidated financial statements or required to make certain disclosures, or that this Agreement is a lease, Buyer shall so notify Seller in writing. Within a time frame mutually agreed to by Buyer and Seller, Seller shall provide to Buyer written quarterly reports containing any and all financial data associated with the Seller and the Plant associated with this Agreement or any other information that the Buyer determines in its sole discretion is required to comply with the accounting treatment associated with these accounting standards or future applicable accounting standards. Such information may include, but shall not be limited to, nameplate Capacity of the Plant, megawatt-hours of electricity produced and used by the Plant, data supporting the economic life (both initial and remaining) of the Plant, the fair market value of the Plant, and any and all other costs (including costs of debt specific to the Plant) associated with the Seller. Further, if it is determined that the Seller is a variable interest entity and that Buyer will be required to include Seller in its consolidated financial statements, Seller shall also provide the following on a quarterly basis:
Variable Interest Entity. (a) Each party to the Control Documents has the legal right, power and authority (corporate and other) to enter into and perform its or his or her obligations under each Control Document to which it or he or she is a party and has taken all necessary action (corporate and other) to authorize the execution, delivery and performance of, and has authorized, executed and delivered, each Control Document to which it or he or she is a party.
(b) The execution and delivery by each party named in each Control Document, and the performance by such party of its obligations thereunder and the consummation by it of the transactions contemplated therein shall not (i) conflict with or result in a breach or violation of such party's certificate of incorporation or bylaws or equivalent organizational documents, (ii) conflict with or result in a breach or violation of any Law applicable to such party; (iii) conflict with or result in a breach, acceleration, material modification or violation in of, or constitute a material default under, any Material Contract to which such party or any member of the Transferred Group is a party or by which such party or any member of the Transferred Group is bound; or (iv) result in the creation of any Encumbrance upon any assets, rights or properties of such party or member of the Transferred Group except those under the Control Documents.
(c) All consents required in connection with the Control Documents have been made or unconditionally obtained in writing, and no such consent has been withdrawn or be subject to any condition precedent which has not been fulfilled or performed.
(d) The pledge of equity securities pursuant to the Control Documents has been duly filed with the competent Governmental Authority in China.
(e) No payments were made by any Variable Interest Entity in connection with the removal or appointment of any shareholder of such Variable Interest Entity.
Variable Interest Entity. The Company determined that the ▇▇▇▇▇▇▇▇ entities holding the ▇▇▇▇▇▇▇▇ Broadcast Assets subject to the Option Agreement (the “▇▇▇▇▇▇▇▇ VIE”) is a variable interest entity (“VIE”) in which the Company holds a controlling financial interest. The Company’s conclusion that the ▇▇▇▇▇▇▇▇ VIE is a VIE results from the Option Agreement, which caps ▇▇▇▇▇▇▇▇ VIE’s right to residual returns. Pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) paragraph 810-10-25-38A and paragraph 810-10-25-38B, a reporting entity (the Company) is deemed to have a controlling financial interest in a VIE if it has both of the following characteristics: a The power to direct the activities of a VIE that most significantly impact the VIE’s economic performance; and b The obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The Company determined that since substantially all of the activities of the ▇▇▇▇▇▇▇▇ VIE are conducted on behalf of a single VIE holder, and that the Company is the primary beneficiary of the VIE, the remaining assets and liabilities of the ▇▇▇▇▇▇▇▇ VIE should be consolidated in the Company’s consolidated financial statements as of April 17, 2024.
Variable Interest Entity. The Company and its relevant Subsidiaries (where applicable) have terminated, on or prior to the Closing Date, all contracts and other arrangements with Beijing Dehaier Technology Co., Ltd. (the “Former VIE Entity”), a company formed under the laws of China that previously served as the Company’s variable interest entity through a series of contractual arrangements, and there is no Liability owed by the Company or any of its Subsidiaries to the Former VIE Entity. The Company owns all outstanding equity interests in Beijing Dehaier Medical Technology Co., Ltd., free and clear of all liens, claims and encumbrances, which in turn owns, directly or indirectly, all equity interests in all other Subsidiaries of the Company free and clear of liens, claims and encumbrances.