+ special purpose entity (SPE)USAAn entity formed to develop, own and operate a special project while isolating financial risk and minimizing bankruptcy risk (making it "bankruptcy-remote"). It is typically prohibited from incurring debt or other obligations, and limited in its purpose and the activities in which it may engage. The entity's sole asset is the property securing the loan and its sole purpose is to own and manage the property. To isolate financial risk, the business is structured to meet strict accounting requirements to qualify for off-balance sheet treatment. Other restrictions are often put in place to reduce the risk that the entity itself will voluntarily file for bankruptcy, be involuntarily forced into bankruptcy as a result of substantive consolidation with an affiliate's bankruptcy, or otherwise be adversely affected by a bankruptcy of its parent or affiliates.See also
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.