linda,
" Certain prepaid taxes and certain rights to
any refund, rebate or credit of taxes “
it's exactly that kind of language you said you had issues with. agree, i think that is kabuki theatre language, the real meaning of which includes nols and tax credits.
regarding "cannot be liquidated" i don't necessarily agree.
there was another interesting article posted and maybe the topic was addressed the the fordham article which indicated an unwillingness to place much emphasis on the nols and tax credits in a bk because the debtors, if they actually were serious about structuring a reorganization, wanted to get as many concessions from creditors, file a plan, get it approved and then emerge, and then voila! have all of these tax attributes they could now use since they were able to clean up their own balance sheet via the bk process. before bk, all they could do was generate nols and tax credits because they had a money losing or poorly run business. emerge more lean and clean and now take advantage, via past mistakes, of their tax attributes which they kept under wraps during the process.
that fordham article criticized this exact process claiming the insiders always had more information regarding the real benefit of these tax attributes and the creditors were just left flapping in the wind. they didn't have enough information to value them and since the company did report them on financials, but valued them very low to zero because of the uncertainty over realization, the creditors weren't left with much of an argument to claim them as an asset.
