1009-00005 · Skybridge Fintech Ltd · Opinions

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CALDERWOOD & HARKNESS LLP Attorneys at Law

425 Lexington Avenue New York, New York 10017

Telephone: (212) 558-4000 Facsimile: (212) 558-3588 www.calderwoodharkness.com

[__], 2024

DRAFT — FOR DISCUSSION PURPOSES ONLY — NOT FOR DELIVERY

SkyLend Receivables Trust 2024-1 c/o Keymark Trust Company, National Association, as Owner Trustee 600 North King Street Wilmington, Delaware 19801

Atlantic Fiduciary Services, Inc., as Indenture Trustee 2 Christiana Centre, Suite 1400 Wilmington, Delaware 19801

Halcyon Securities LLC, as Initial Purchaser 200 Vesey Street, 42nd Floor New York, New York 10281

Re: True-Sale Opinion — Transfer of Consumer Installment-Loan Receivables from Skybridge Fintech Ltd. to SkyLend Funding LLC Pursuant to the Receivables Purchase Agreement dated as of [________], 2024

Ladies and Gentlemen:

I. INTRODUCTION AND SCOPE

Calderwood & Harkness LLP ("we," "us," or "C&H") has acted as counsel to Skybridge Fintech Ltd., a Delaware corporation ("SBF" or the "Originator"), SkyLend Funding LLC, a Delaware limited liability company and single-member subsidiary of SBF (the "Depositor"), and SkyLend Receivables Trust 2024-1, a Delaware statutory trust (the "Trust" or the "Issuer"), in connection with the issuance by the Trust of $170,000,000 aggregate principal amount of Class A Asset-Backed Notes (the "Class A Notes") and $22,000,000 aggregate principal amount of Class B Asset-Backed Notes (the "Class B Notes" and, together with the Class A Notes, the "Notes") pursuant to the Indenture (as defined below).

This opinion letter (this "Opinion") is delivered in connection with the proposed offering by the Trust of the Notes in a private placement exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"), pursuant to Rule 144A and Regulation S promulgated thereunder. The Notes are asset-backed notes secured by a pool of unsecured consumer installment-loan receivables (the "Receivables") originated by SBF through its proprietary online consumer lending platform known as "SkyLend" and transferred by SBF to the Depositor pursuant to the Receivables Purchase Agreement described herein.

This Opinion is being delivered to the addressees hereof in connection with the foregoing transactions, and this letter constitutes a legal opinion within the meaning of customary closing deliverables for transactions of this nature. This Opinion is identified as C&H Matter No. 1009-00005.

II. DOCUMENTS REVIEWED

In connection with rendering the opinions expressed herein, we have examined originals or copies of the following documents (collectively, the "Transaction Documents"):

(a) Receivables Purchase Agreement dated as of [__], 2024 (the "RPA"), between Skybridge Fintech Ltd., as seller (the "Seller"), and SkyLend Funding LLC, as purchaser (the "Purchaser"), in the form of the draft dated March 11, 2024;

(b) Sale and Servicing Agreement dated as of [__], 2024 (the "SSA"), among SkyLend Funding LLC, as depositor, SkyLend Receivables Trust 2024-1, as issuer, Skybridge Fintech Ltd., as servicer (in such capacity, the "Servicer"), and Clearview Loan Servicing, Inc., as sub-servicer (the "Sub-Servicer"), in the form of the draft dated March 11, 2024;

(c) Indenture dated as of [__], 2024 (the "Indenture"), between SkyLend Receivables Trust 2024-1, as issuer, and Atlantic Fiduciary Services, Inc., as indenture trustee (the "Indenture Trustee"), in the form of the draft dated March 4, 2024;

(d) Trust Agreement dated February 14, 2024 (the "Trust Agreement"), between SkyLend Funding LLC, as depositor, and Keymark Trust Company, National Association, as owner trustee (the "Owner Trustee");

(e) Limited Liability Company Agreement of SkyLend Funding LLC (the "LLC Agreement"), dated January 30, 2024, with Skybridge Fintech Ltd. as sole member and Danielle Prescott as Manager;

(f) Certificate of Formation of SkyLend Funding LLC, filed with the Secretary of State of the State of Delaware on January 30, 2024 (EIN: 93-4187620);

(g) Certificate of Trust of SkyLend Receivables Trust 2024-1, filed with the Secretary of State of the State of Delaware on February 14, 2024 (EIN: 93-4201855);

(h) Secretary's Certificate and Board Resolutions of Skybridge Fintech Ltd. authorizing the securitization transaction contemplated by the Transaction Documents and the execution, delivery, and performance by SBF of each of the Transaction Documents to which it is a party (the "Secretary's Certificate");

(i) Preliminary Offering Memorandum dated April 5, 2024 (the "Preliminary Offering Memorandum") relating to the offering of the Notes;

(j) Officer's Certificate of Skybridge Fintech Ltd. (in draft form) (the "Officer's Certificate"), to be delivered at the closing of the transactions contemplated by the Transaction Documents;

(k) UCC-1 financing statements (in draft form) to be filed (i) against SBF (as debtor) in favor of SkyLend Funding LLC (as secured party) with the Secretary of State of the State of Delaware and (ii) against SkyLend Funding LLC (as debtor) in favor of the Trust (as secured party) with the Secretary of State of the State of Delaware (collectively, the "UCC Filings"); and

(l) such other documents, records, certificates, instruments, and agreements as we have deemed necessary or appropriate for purposes of rendering this Opinion, including good standing certificates, organizational documents, and such other items as we considered relevant to the matters addressed herein.

The documents listed in clauses (a) through (l) above, together with any supplements, amendments, or modifications thereto delivered prior to the date hereof, are collectively referred to herein as the "Transaction Documents."

We have also reviewed such statutes, rules, regulations, and judicial and administrative decisions as we have considered relevant and necessary for the purposes of this Opinion.

III. ASSUMPTIONS

In rendering the opinions set forth herein, we have, with your permission, assumed without independent investigation or verification the accuracy and completeness of the following:

(a) All documents reviewed by us in connection with this Opinion are authentic, all signatures thereon are genuine, and all natural persons who have executed any such documents had the legal capacity to do so at the time of execution.

(b) All documents submitted to us as copies, whether certified, conformed, or reproduced, conform to the originals thereof, and all originals are authentic.

(c) Each party to the Transaction Documents (other than SBF, the Depositor, and the Trust) has the requisite power, authority, and legal right to execute, deliver, and perform its obligations under each of the Transaction Documents to which it is a party, and each such document constitutes a legal, valid, and binding obligation of such party, enforceable against it in accordance with its terms.

(d) The Transaction Documents have been or, prior to closing, will be duly authorized, executed, and delivered by all parties thereto in the forms reviewed by us, with only such changes as are not material to the opinions expressed herein.

(e) The Receivables to be transferred under the RPA are unsecured consumer installment-loan receivables originated by SBF through its SkyLend platform, with original contractual terms ranging from 12 to 60 months and individual principal balances at the time of origination ranging from $1,000 to $25,000, and all such Receivables conform to the eligibility criteria set forth in Section 2.03 of the RPA and Schedule A thereto.

(f) The consideration paid by SkyLend Funding LLC to SBF under the RPA for the purchase of the Receivables constitutes reasonably equivalent value and fair consideration within the meaning of applicable fraudulent-transfer and fraudulent-conveyance statutes, including, without limitation, the Uniform Fraudulent Transfer Act and Section 548 of the Bankruptcy Code.

(g) Each of SBF, the Depositor, and the Trust is solvent at the time of each transfer contemplated by the Transaction Documents and will not be rendered insolvent thereby. No transfer contemplated by the Transaction Documents is made with the intent to hinder, delay, or defraud any creditor of SBF, the Depositor, or the Trust, and no such transfer constitutes a preference or fraudulent transfer under the Bankruptcy Code or any applicable state law.

(h) The UCC-1 financing statements described in Section II(k) above will be duly filed and properly indexed in the relevant filing offices of the Secretary of State of the State of Delaware prior to the closing date of the transactions contemplated by the Transaction Documents, and all continuation statements required to maintain the effectiveness of such filings will be timely filed.

(i) SBF, the Depositor, and the Trust will comply in all material respects with all separateness covenants and bankruptcy-remoteness provisions set forth in the LLC Agreement, the Trust Agreement, and the Transaction Documents throughout the term of the transactions contemplated thereby.

(j) The factual matters set forth in the Officer's Certificate of SBF (in the form to be delivered at closing) are and will be true, correct, and complete as of the date of the Officer's Certificate and as of the closing date, and no facts or circumstances have arisen or will arise between the date hereof and the closing date that would render any such factual matter inaccurate or misleading.

(k) The Receivables pool as of the cut-off date of March 31, 2024, comprises approximately 23,100 individual consumer installment loans with an aggregate outstanding principal balance of approximately $213,750,000, from which a final pool with an aggregate outstanding principal balance of approximately $200,000,000 (the "Final Pool") will be selected after credit analysis and eligibility screening in accordance with the criteria and procedures set forth in the RPA and the SSA.

IV. OPINIONS

A. True-Sale Characterization

Based upon the foregoing and subject to the assumptions, qualifications, and limitations set forth herein, it is the opinion of Calderwood & Harkness LLP that the transfer of the Receivables from Skybridge Fintech Ltd. (as Seller) to SkyLend Funding LLC (as Purchaser) under the Receivables Purchase Agreement should be characterized as a "true sale" of such Receivables for purposes of the U.S. Bankruptcy Code (Title 11 of the United States Code) (the "Bankruptcy Code") and should not be recharacterized as a secured loan from the Purchaser to the Seller.

We note that the foregoing opinion is rendered on a "should" basis rather than a "will" basis. The characterization of a transfer of financial assets as a "true sale" or, alternatively, as a secured financing is ultimately a question of fact determined by a court of competent jurisdiction applying the relevant factors under applicable law to the particular facts and circumstances of the transaction. No opinion of counsel can guarantee a particular outcome, and we cannot assure you that a court, if called upon to consider the question, would not reach a conclusion different from the opinion expressed herein. The "should" formulation used herein reflects both the inherently factual nature of true-sale analysis and the absence of a single, uniform statutory or judicial test that governs the determination. Notwithstanding the foregoing, we believe that the factors discussed below, taken together, strongly support the characterization of the transfer as a true sale, and we are not aware of any factor that, standing alone or taken together with other factors, would require a court to reach a contrary conclusion.

B. Analysis of True-Sale Factors

In reaching the opinion set forth in Section IV.A above, we have considered the factors that courts have historically applied in evaluating whether a transfer of financial assets constitutes a true sale or a secured financing under the Bankruptcy Code and applicable precedent. These factors, while not uniformly weighted by all courts, are drawn from decisions including, among others, In re LTV Steel Co., 285 B.R. 259 (Bankr. N.D. Ohio 2002); In re Octagon Gas Systems, Inc., 229 B.R. 471 (Bankr. W.D. Okla. 1999); Major's Furniture Mart, Inc. v. Castle Credit Corp., 602 F.2d 538 (3d Cir. 1979); In re Commercial Money Center, Inc., 350 B.R. 465 (9th Cir. BAP 2006); Endico Potatoes, Inc. v. CIT Group/Factoring, Inc., 67 F.3d 1063 (2d Cir. 1995); and In re Golden Key Realty, Inc., 765 F.2d 700 (8th Cir. 1985). We have also considered the analytical framework set forth in Restatement (Third) of the Law — Property (Security) and the Uniform Commercial Code ("UCC") as adopted in the State of Delaware. We discuss each relevant factor below.

1. Intent of the Parties

The intent of the parties to the transaction is a significant, and in many courts' analyses a threshold, factor in determining whether a transfer constitutes a true sale. Here, the expressed intent of SBF and SkyLend Funding LLC is unambiguously to effect an absolute and irrevocable sale of the Receivables, rather than a pledge of the Receivables as collateral for a loan.

The RPA expressly characterizes the transfer of the Receivables as a sale and not as a loan, pledge, or other financing arrangement. Section 2.01 of the RPA provides, in relevant part, that the Seller "hereby sells, assigns, transfers, and conveys to the Purchaser, without recourse (except as specifically provided herein), all right, title, and interest of the Seller in and to" the Receivables. The recitals to the RPA further confirm that the parties intend the transfer to constitute a "true sale" and "absolute assignment" of the Receivables. Section 2.01(b) of the RPA provides that "it is the intention of the parties hereto that the transfer of the Receivables from the Seller to the Purchaser pursuant to this Agreement shall constitute an absolute sale and assignment thereof, and not a pledge of, or grant of a security interest in, such Receivables to secure a debt or other obligation of the Seller."

The operative provisions of the RPA are consistent with and reinforce this stated intent. The agreement does not provide for repayment of a loan balance, does not specify an interest rate on any "advance," and does not establish a maturity date by which a principal amount must be returned to the Purchaser. These structural features are inconsistent with a secured financing and strongly supportive of sale treatment.

In addition to the RPA, the following documents and corporate actions evidence the parties' intent to effectuate a true sale:

(i) The Board Resolutions of SBF, as evidenced by the Secretary's Certificate, expressly authorize the "sale" of Receivables by SBF to SkyLend Funding LLC pursuant to the RPA and characterize the transaction as a sale in their operative recitals and resolutions.

(ii) The Preliminary Offering Memorandum dated April 5, 2024, describes the transfer of Receivables from SBF to the Depositor as a sale and not as a financing or pledge. The risk-factor disclosures in the Preliminary Offering Memorandum acknowledge the importance of true-sale characterization to the structural integrity of the securitization and the isolation of the Receivables from the bankruptcy estate of SBF.

(iii) SBF intends to treat the transfer as a sale for accounting purposes under United States generally accepted accounting principles ("GAAP"), specifically under Accounting Standards Codification Topic 860 (Transfers and Servicing). We understand that Rowland & Cross LLP, SBF's independent registered public accounting firm (engagement partner Nathan Delacroix), has been engaged to review and, if appropriate, confirm this accounting treatment. While we express no opinion on accounting matters and note that our opinion does not address or depend upon the accounting treatment of the transfer, the intended accounting treatment is consistent with the parties' expressed legal intent and constitutes an additional indicum of true-sale characterization.

Taken together, these manifestations of intent provide strong support for the conclusion that the transfer of the Receivables is intended by the parties to constitute a sale, and not a loan.

2. Transfer of Risks and Benefits of Ownership

Courts analyzing true-sale questions consistently examine the extent to which the transferor has transferred the economic risks and benefits of ownership of the transferred assets to the transferee. In a true sale, the transferee bears the economic risk of non-performance of the transferred assets, including credit risk, and is entitled to the economic benefits of ownership, including the right to all collections and recoveries. By contrast, in a secured financing, the transferor retains these risks and benefits and the transferee's interest is limited to a security interest securing repayment of an advance.

In the present transaction, the transfer of the Receivables from SBF to SkyLend Funding LLC under the RPA results in a substantial and meaningful transfer of the risks and benefits of ownership:

(i) Credit Risk. Upon the effective date of the transfer under the RPA, SkyLend Funding LLC (and, following the downstream transfer to the Trust under the SSA, the Trust and, ultimately, the Noteholders) bears the credit risk of the Receivables, including the risk that individual obligors may default on their payment obligations. SBF does not bear credit risk with respect to the Receivables following the transfer, except to the limited extent of the repurchase obligations described in Section IV.B.3 below.

(ii) Right to Collections. Following the transfer, SkyLend Funding LLC (and subsequently the Trust) is entitled to all collections and recoveries on the Receivables, including scheduled principal and interest payments, prepayments, late fees, and net recoveries following default. SBF has no right to receive or retain any collections or other amounts payable on the Receivables following the transfer, other than as described below.

(iii) Retained Residual Interest. SBF does not retain a right to the economic upside or surplus collections on the transferred Receivables, other than through the approximately $8,000,000 residual interest (representing approximately 4% of the total capital structure of the Trust) retained by SBF indirectly through SkyLend Funding LLC, which interest represents the Depositor's retained interest as holder of the Subordinated Certificate issued by the Trust. This residual interest is subordinated in right of payment to both the Class A Notes and the Class B Notes and represents the "first loss" position in the capital structure.

We note that the retention of a residual interest by SBF, through the Depositor, does not negate true-sale treatment. The retention of a subordinated or residual interest by a transferor or its affiliate is customary and indeed standard in securitization structures and has been recognized by courts and commentators as consistent with true-sale characterization. See, e.g., Major's Furniture Mart, 602 F.2d at 544-45; Endico Potatoes, 67 F.3d at 1068. Moreover, the retention of a residual interest of this nature may be required under applicable risk-retention regulations, including the credit risk-retention rules promulgated pursuant to Section 15G of the Securities Exchange Act of 1934 and the rules adopted thereunder by the applicable federal agencies (the "Risk Retention Rules"). The retention of a residual interest in compliance with, or consistent with the policies underlying, the Risk Retention Rules does not alter the legal characterization of the transfer as a sale.

3. Recourse. The extent to which a transferor retains recourse obligations with respect to transferred assets is a critical factor in the true-sale analysis. Where the transferor bears the full credit risk of the transferred assets through a broad recourse obligation or a guarantee of collections, courts are more likely to characterize the transfer as a secured financing rather than a true sale. Conversely, where recourse is limited or absent, the transfer is more likely to be treated as a sale.

Under the RPA, SBF does not provide SkyLend Funding LLC with general recourse against SBF for credit losses on the Receivables. SBF does not guarantee the collectibility of the Receivables, does not agree to "make whole" the Purchaser in the event of borrower default, and does not otherwise assume the credit risk of the Receivables following the transfer.

SBF's sole post-sale obligation with respect to the Receivables is the repurchase obligation set forth in Section 3.04 of the RPA. Under that provision, SBF is obligated to repurchase individual Receivables that breach the representations and warranties made by SBF with respect to such Receivables as set forth in the RPA, or that fail to meet the eligibility criteria specified in Section 2.03 of the RPA and Schedule A thereto, at a repurchase price equal to the outstanding principal balance of such Receivables plus accrued and unpaid interest thereon. This repurchase obligation is limited in scope and applies only to specific, identifiable breaches of representations, warranties, or eligibility criteria — it does not apply to, and cannot be triggered by, borrower default, delinquency, or any deterioration in the credit quality of the Receivables that is not attributable to a breach of the Seller's representations and warranties.

This limited, breach-based repurchase obligation is consistent with true-sale characterization under prevailing case law. Courts have consistently held that an obligation to repurchase or substitute assets that do not conform to agreed-upon specifications is a standard feature of asset sales and does not convert a sale into a financing. See, e.g., Major's Furniture Mart, 602 F.2d at 544; Endico Potatoes, 67 F.3d at 1068-69. The repurchase obligation in the RPA is analogous to a seller's warranty of conformity in a sale of goods and serves a function materially different from a general credit-risk guarantee or recourse obligation.

Critically, SBF has no obligation under the RPA or any other Transaction Document to repurchase Receivables solely because of borrower default or delinquency. The absence of such a general credit-support obligation is a strong indicator that the transfer is a sale, not a loan.

4. Purchase Price

The adequacy and structure of the purchase price paid by the transferee for the transferred assets is another factor relevant to the true-sale analysis. Where the purchase price approximates the fair market value of the transferred assets, the transaction resembles a sale. Where the "purchase price" is in substance an advance of a fixed principal amount, with the transferred assets serving merely as collateral, the transaction is more likely to be treated as a financing.

The purchase price under the RPA is established at the closing of the transaction and is designed to reflect the fair market value of the Receivables as of the cut-off date. The purchase price takes into account the credit characteristics and expected performance of the Receivables, including, among other things:

(i) The weighted average coupon ("WAC") of the Receivables pool, which is approximately 14.82%;

(ii) The weighted average remaining term of the Receivables, which is approximately 38.4 months;

(iii) The weighted average FICO score at origination of the obligors on the Receivables, which is approximately 698; and

(iv) Historical performance data regarding default rates, prepayment rates, and recovery rates for consumer installment loans originated through the SkyLend platform.

These pool characteristics are consistent with the conclusion that the purchase price under the RPA constitutes reasonably equivalent value for the Receivables transferred and reflects an arm's-length pricing determination. The pricing mechanism employed under the RPA is consistent with market practice for consumer-loan securitizations and does not exhibit the characteristics of a loan advance.

5. Dominion and Control

Courts also consider the extent to which the transferor relinquishes dominion and control over the transferred assets following the transfer. In a true sale, the transferor divests itself of ownership and control; the transferee assumes the right to manage, hold, dispose of, or otherwise deal with the transferred assets. In a secured financing, by contrast, the debtor typically retains possession and control of the collateral, subject to the secured party's lien.

In the present transaction, SBF relinquishes dominion and control over the Receivables upon their transfer to SkyLend Funding LLC under the RPA:

(i) Collection Account. Collections on the Receivables are deposited into a segregated collection account (the "Collection Account") established at Keymark Trust Company, National Association, in its commercial banking capacity, and are subject to a separate Account Control Agreement (the "ACA") among the Trust, Atlantic Fiduciary Services, Inc. (as Indenture Trustee), and Keymark Trust Company, National Association. Pursuant to the ACA, the Indenture Trustee has "control" (within the meaning of Section 9-104 of the UCC as adopted in the State of Delaware) over the Collection Account, and neither SBF nor the Depositor has the unilateral right to direct the disposition of funds in the Collection Account.

(ii) No Commingling. SBF does not have the right or ability to commingle collections on the Receivables with its own funds after the effective date of the transfer. The SSA requires that all collections received by the Sub-Servicer be remitted to the Collection Account within two (2) business days of receipt, and the SSA and the RPA prohibit SBF from commingling any amounts constituting collections on the Receivables with SBF's own assets.

(iii) Servicing Arrangements. Servicing of the Receivables is performed by Clearview Loan Servicing, Inc., as Sub-Servicer, under the SSA, with SBF acting as master servicer (in such capacity, the "Servicer"). In its capacity as Servicer, SBF services the Receivables for the benefit of the Trust and the Noteholders, and not for the benefit of SBF in its capacity as originator or former owner of the Receivables. The SSA establishes servicing standards, reporting requirements, and oversight mechanisms that are designed to ensure that the Servicer acts in the interests of the Trust and the Noteholders. The Servicer is subject to termination for cause and is required to service the Receivables in accordance with the customary and usual servicing practices of prudent consumer installment-loan servicers. SBF's role as master servicer does not constitute retention of dominion or control over the Receivables within the meaning of the true-sale analysis; courts have consistently recognized that a transferor may act as servicer of transferred assets without negating true-sale treatment, provided that servicing is performed for the benefit of the transferee and in accordance with contractual standards. See, e.g., In re Octagon Gas Systems, 229 B.R. at 482.

6. UCC Filing / Precautionary Security Interest

As described in Section II(k) above, UCC-1 financing statements will be filed as a precautionary measure against SBF (as debtor) in favor of SkyLend Funding LLC (as secured party), and against SkyLend Funding LLC (as debtor) in favor of the Trust (as secured party), with the Secretary of State of the State of Delaware.

The filing of precautionary UCC-1 financing statements does not negate the characterization of the transfer as a true sale. It is well established in securitization practice, and has been recognized by courts and commentators, that the filing of precautionary financing statements is a standard protective measure designed to preserve the transferee's interest in the transferred assets in the event that a court were to recharacterize the sale as a financing. See UCC § 9-109(a)(3) and Comment 4 thereto (recognizing that a transaction may be documented as an outright sale while also providing for the filing of a financing statement as a precautionary measure); see also In re Commercial Money Center, 350 B.R. at 488-89. The RPA expressly provides, in Section 2.01(c), that the filing of the UCC-1 financing statements is not intended to evidence a loan or security interest but is made "solely to protect the Purchaser's interests in the Receivables in the event that, notwithstanding the intent of the parties as set forth in this Agreement, the transfer of the Receivables hereunder were to be characterized as a grant of a security interest." This express disclaimer is consistent with true-sale characterization and reflects market-standard practice.

7. Separateness and Bankruptcy Remoteness of the Purchaser

The organizational structure and bankruptcy-remoteness features of the Purchaser are relevant to the true-sale analysis because they affect the likelihood that the transferred assets would be treated as property of the Seller's bankruptcy estate in the event of the Seller's insolvency. If the Purchaser is a bona fide separate entity with its own distinct legal existence, the characterization of the transfer as a sale is reinforced, because the transferred assets are held by an entity whose assets would not be consolidated with those of the Seller in bankruptcy.

SkyLend Funding LLC was formed as a Delaware limited liability company on January 30, 2024, solely for the purpose of purchasing the Receivables from SBF and transferring them to the Trust. It is a special-purpose entity ("SPE") designed to serve as the depositor in the securitization structure and has no operations, employees, or assets other than those related to the transactions contemplated by the Transaction Documents.

The LLC Agreement of SkyLend Funding LLC contains comprehensive separateness covenants designed to ensure that the Depositor maintains its status as a legal entity distinct from SBF and any other affiliate. These covenants include, among others, requirements that the Depositor:

(i) maintain separate books, records, and financial statements from those of SBF and its other affiliates;

(ii) maintain separate bank accounts in its own name and not commingle its assets with those of SBF or any other person;

(iii) hold itself out to the public and all third parties as a legal entity separate and distinct from SBF and any other person;

(iv) conduct all business in its own name and through its own authorized officers, managers, agents, and employees (or those of its manager);

(v) maintain adequate capitalization in light of its contemplated business purposes and transactions;

(vi) observe all organizational formalities required by applicable law and its governing documents;

(vii) not guarantee or otherwise become liable for the debts or obligations of SBF or any other person;

(viii) pay its own liabilities and expenses from its own assets;

(ix) not acquire or hold any assets other than the Receivables and related property as contemplated by the Transaction Documents; and

(x) refrain from incurring any indebtedness other than as expressly contemplated by the Transaction Documents.

In addition to the separateness covenants, the LLC Agreement contains an independent director/manager provision designed to prevent SkyLend Funding LLC from filing a voluntary petition for relief under the Bankruptcy Code without the prior affirmative consent of at least one independent manager who is not an officer, director, employee, or affiliate of SBF. The sole member of SkyLend Funding LLC is SBF, and Danielle Prescott, the Chief Financial Officer of SBF, serves as the Manager of SkyLend Funding LLC. However, the LLC Agreement expressly restricts the authority of the Manager (and the sole member) to cause SkyLend Funding LLC to file a bankruptcy petition, seek relief under any insolvency law, or consent to the appointment of a receiver, without the prior affirmative vote or written consent of at least one independent manager appointed in accordance with the LLC Agreement. This "Blocking" or "springing" independent-manager provision is a standard bankruptcy-remoteness feature in securitization structures and serves to reduce the risk that SkyLend Funding LLC would be placed into bankruptcy proceedings at the direction of SBF.

We note that the question of whether SkyLend Funding LLC would be substantively consolidated with SBF in a bankruptcy proceeding is addressed in a separate non-consolidation opinion to be delivered at closing and is not addressed in this Opinion. This Opinion assumes, consistent with Assumption (i) above, that the separateness covenants and bankruptcy-remoteness provisions described above are and will continue to be observed and complied with in all material respects.

V. QUALIFICATIONS AND LIMITATIONS

The opinions expressed herein are subject to the following qualifications and limitations:

(a) Jurisdictional Limitation. This Opinion is limited to the federal laws of the United States and the laws of the State of New York and the State of Delaware, in each case as currently in effect. We express no opinion as to the laws of any other jurisdiction, and we express no opinion regarding the effect or application of the laws of any jurisdiction other than those specifically identified in this paragraph.

(b) Date Limitation. The opinions expressed herein are based upon statutes, rules, regulations, and reported judicial and administrative decisions in effect as of the date hereof. We assume no obligation to update or supplement this Opinion to reflect any changes in law, fact, or circumstance occurring after the date hereof, whether or not such changes would affect the opinions expressed herein.

(c) Factual Nature of True-Sale Determination. As noted in Section IV.A above, the characterization of a transfer of financial assets as a "true sale" or as a secured financing is ultimately a question of fact determined by a court of competent jurisdiction under applicable law. No opinion of counsel can guarantee the outcome of such a determination, and a court's analysis may include consideration of factors not addressed in this Opinion or may weigh the factors discussed herein differently than we have. The opinion set forth in Section IV.A is rendered on a "should" basis, and we cannot provide assurance that a court would necessarily agree with our conclusion.

(d) Fraudulent Transfer. We express no opinion regarding the applicability or effect of any fraudulent-transfer or fraudulent-conveyance statute (whether state or federal), including, without limitation, the Uniform Fraudulent Transfer Act, the Uniform Voidable Transactions Act, Section 548 of the Bankruptcy Code, or any comparable state or federal law, to the transfers described herein. This Opinion assumes, consistent with Assumption (g) above, that no such statute is implicated by the transfers contemplated by the Transaction Documents.

(e) Tax, Accounting, and Regulatory Treatment. We express no opinion as to the tax treatment (whether for federal, state, local, or foreign tax purposes), accounting treatment (whether under GAAP or any other accounting standard), or regulatory characterization of the transfers described herein or of the Receivables, the Notes, or any other aspect of the transactions contemplated by the Transaction Documents.

(f) Reliance on Representations and Data. We have not independently verified the accuracy, completeness, or currency of the pool data, servicing data, or financial information regarding the Receivables, and we have relied upon the representations and warranties of SBF as set forth in the RPA and the Officer's Certificate. We assume no responsibility for the accuracy or completeness of any such data or information, and our opinions are conditioned on the accuracy of such representations and warranties.

(g) Date and Bring-Down. This Opinion is given as of its date and speaks only as of that date. We express no opinion as to any matter as of any date subsequent to the date hereof. We understand that, in accordance with the terms of the Transaction Documents, a bring-down certificate will be delivered by SBF at closing confirming the continued accuracy and completeness of the representations and warranties set forth in the RPA and the Officer's Certificate as of the closing date.

(h) Compliance with Separateness Covenants. The characterization of the transfer of the Receivables as a true sale could be adversely affected by the failure of SBF, the Depositor, or the Trust to observe and comply with the separateness covenants, bankruptcy-remoteness provisions, or other requirements set forth in the LLC Agreement, the Trust Agreement, and the Transaction Documents. Our opinion is expressly conditioned on the continued compliance by SBF, the Depositor, and the Trust with all such covenants and provisions in all material respects throughout the term of the transactions contemplated by the Transaction Documents.

(i) Reliance Limitation. This Opinion is rendered solely for the benefit of the addressees hereto and may not be relied upon by any other person or entity without our prior written consent. Notwithstanding the foregoing, we hereby consent to reliance on this Opinion by Halcyon Securities LLC and its counsel, Whitfield, Drummond & Paige LLP, as if they were addressees hereof, in connection with the transactions contemplated by the Transaction Documents. Neither this Opinion nor any copy hereof may be furnished to, or relied upon by, any other person or entity, or used, circulated, quoted, or otherwise referred to for any other purpose, without our prior express written consent.

VI. GOVERNING LAW

This opinion letter is governed by and shall be construed in accordance with the laws of the State of New York, without regard to any conflict-of-laws principles that would result in the application of the laws of any other jurisdiction.

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Very truly yours,