Common use of Materiality Threshold Clause in Contracts

Materiality Threshold. Solely for purposes of determining the satisfaction of the conditions set forth in Sections 5.2.1 and 5.3.1, the failure of any representation or warranty to be true and correct shall be material if the Liabilities incurred or suffered or reasonably expected to be incurred or suffered by the Caterpillar Indemnified Persons (on the one hand) or the Navistar Indemnified Persons (on the other hand), respectively, to the extent arising out of such failure to be true and correct (without taking into account any indemnification, insurance or third party proceeds and without giving effect to any limitation as to “materiality” or like wording or “Material Adverse Effect” or like wording set forth therein) (such Liabilities, “Caterpillar Expected Liabilities” and “Navistar Expected Liabilities,” respectively), would reasonably be expected by the non-breaching party to exceed $250,000, individually or in the aggregate (the “Materiality Threshold”).