Additional Parent Liability Sample Clauses
The Additional Parent Liability clause establishes that a parent company assumes certain liabilities or obligations in addition to those of its subsidiary under an agreement. In practice, this means the parent company may be held responsible for debts, damages, or contractual breaches incurred by the subsidiary, often to provide extra assurance to the other party in the contract. This clause primarily functions to allocate risk and enhance the enforceability of the agreement by ensuring that the parent company stands behind the subsidiary’s commitments, thereby reducing the counterparty’s exposure to potential non-performance or insolvency of the subsidiary.
Additional Parent Liability. Parent shall be responsible for any liability for:
(a) Separation Tax Losses resulting from, without duplication, a breach by Parent of any covenant in this Agreement, the Merger Agreement, the Separation and Distribution Agreement, or any other Transaction Document, in each case, that causes any of the Tax-Free Transactions (other than the Merger) to fail to qualify for Tax-Free Status; provided that, for the avoidance of doubt, the exclusion of the Merger above in this Section 2.07(a) shall not exclude any such Tax arising from the failure of any of the Tax-Free Transactions (other than the Merger) to qualify for Tax-Free Status if such failure occurs as a result of the failure of the Merger to qualify for Tax-Free Status;
(b) Separation Tax Losses resulting from, without duplication, any breach by Parent of any representations, or portions thereof, made by it in this Agreement, the Merger Agreement, or any other Transaction Document or in connection with any Tax Materials, in each case, that causes any of the Tax-Free Transactions (other than the Merger) to fail to qualify for Tax-Free Status; provided that, for the avoidance of doubt, the exclusion of the Merger above in this Section 2.07(b) shall not exclude any such Tax arising from the failure of any of the Tax-Free Transactions (other than the Merger) to qualify for Tax-Free Status if such failure occurs as a result of the failure of the Merger to qualify for Tax-Free Status; and
(c) Separation Tax Losses, as set forth in Section 6.04(b).
Additional Parent Liability. Parent shall be liable for, and shall indemnify and hold harmless the SpinCo Group from and against any liability for, without duplication:
(a) any Tax (other than Separation Tax Losses) (i) resulting from a breach by Parent of any representation or covenant made by Parent in this Agreement, the Separation and Distribution Agreement, or any other Transaction Document or any Representation Letter or (ii) imposed under Section 965(l)(1) of the Code as a result of Parent or any member of the Parent Group becoming an expatriated entity at any time during the ten (10)-year period beginning on December 22, 2017 (within the meaning of Section 965(l) of the Code);
(b) any Separation Tax Losses for which Parent is responsible pursuant to Section 6.05(b); and
(c) any costs and expenses (including all legal, accounting and other professional fees and expenses and court costs) incurred in connection with the Taxes described in clauses (a) and (b).