Materiality Exception Clause Samples
A Materiality Exception clause defines the threshold at which a breach or inaccuracy in a contract becomes significant enough to warrant legal consequences or trigger certain rights, such as termination or indemnification. In practice, this means that minor or insignificant breaches—those that do not materially affect the contract's purpose or the parties' interests—are excluded from claims or remedies. For example, if a party makes a representation that is technically inaccurate but does not have a meaningful impact on the transaction, the Materiality Exception would prevent the other party from pursuing a claim based solely on that inaccuracy. The core function of this clause is to prevent trivial or inconsequential issues from escalating into legal disputes, ensuring that only substantial matters are actionable.
Materiality Exception. The Lien Grantors have the right not to comply with the foregoing provisions of this Section with respect to (i) Deposit Accounts that are payroll or trust accounts and (ii) other Deposit Accounts having total collected balances that do not at any time exceed $2,000,000 in the aggregate for all Lien Grantors.
Materiality Exception. The Lien Grantors have the right not to comply with the foregoing provisions of this Section with respect to Deposit Accounts having collected balances that do not at any time exceed $10,000,000 in the aggregate for all Lien Grantors. However, if an Event of Default occurs and is continuing, the Administrative Agent may terminate the foregoing right not to comply, or reduce the amount thereof, by giving at least ten Business Days' notice of such termination or reduction to the relevant Lien Grantors.
Materiality Exception. The Grantors have the right not to comply with the foregoing provisions of this Section with respect to Deposit Accounts having total collected balances that do not at any time exceed $3,000,000 in the aggregate for all Grantors. However, if an Event of Default occurs and is continuing, the Collateral Agent may terminate the foregoing right not to comply, or reduce the amount thereof, by giving at least 10 Business Days’ notice of such termination or reduction to the relevant Grantors.
Materiality Exception. The Grantors have the right not to comply with the provisions of Section 8(a) with respect to Deposit Accounts having total collected balances, together with any cash not held in a Deposit Account, that do not, at any time, exceed $500,000 in the aggregate for all Grantors.
Materiality Exception. The Lien Grantors have the right not to comply with the foregoing provisions of this Section with respect to (i) an account in the name of Holdings with a balance not exceeding $200,000 at any time and
Materiality Exception. The Lien Grantors have the right not to comply with the foregoing provision of this Section with respect to Pledged Security Entitlements having a fair market value that does not at any time exceed $1,000,000 in the aggregate for all Lien Grantors. However, if an Event of Default occurs and is continuing, the Collateral Agent may terminate the foregoing right not to comply, or reduce the amount thereof, by giving at least 10 days' notice of such termination or reduction to the relevant Lien Grantors.