No Inter-Company Debt Commitment Sample Clauses

The No Inter-Company Debt Commitment clause prohibits parties within the same corporate group from creating or maintaining debt obligations between each other under the agreement. In practice, this means that subsidiaries, affiliates, or parent companies cannot lend to or borrow from one another in a way that would create formal debt relationships covered by the contract. This clause is typically used to prevent the shifting of financial risk or liabilities within a group, ensuring that the agreement’s obligations and exposures remain transparent and are not complicated by internal financing arrangements.