Reorganization 368(a) Sample Clauses
The Reorganization 368(a) clause defines the requirements for a corporate transaction to qualify as a tax-free reorganization under Section 368(a) of the Internal Revenue Code. This clause typically applies to mergers, consolidations, or certain acquisitions where the continuity of interest and business enterprise tests are met, allowing the exchanging of stock or assets without immediate tax consequences. Its core function is to facilitate corporate restructuring by deferring tax liabilities, thereby encouraging efficient business combinations and reorganizations without penalizing shareholders or the companies involved.
Reorganization 368(a). Not take, or fail to take, any action that would reasonably be expected to prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code.