Material Adverse Change definition: Copy, customize, and use instantly
Introduction
The term "Material Adverse Change" refers to any significant and negative change in circumstances that could substantially affect the business, operations, or financial condition of a party to a contract. It is a common clause in financial and commercial agreements to provide a safeguard in case unexpected negative events occur.
Below are various examples of how "Material Adverse Change" can be defined in different contexts. Copy the one that fits your needs, customize it, and use it in your contract.
Definition of "Material Adverse Change" as a financial condition
This definition ties "Material Adverse Change" to the financial condition of a party.
"Material Adverse Change" means any event, development, or condition that has a material and adverse effect on the financial condition, business, operations, or assets of a party, or the ability of a party to fulfill its obligations under this agreement.
Definition of "Material Adverse Change" as an operational impact
This definition connects "Material Adverse Change" to operational impacts.
"Material Adverse Change" refers to any event, occurrence, or condition that materially and negatively affects the operations or business activities of a party, such that it could reasonably be expected to disrupt the party's ability to conduct its normal business.
Definition of "Material Adverse Change" as an economic event
This definition links "Material Adverse Change" to economic events.
"Material Adverse Change" means a change in the economic conditions or financial markets that has a material and adverse effect on a party's ability to perform its obligations, such as significant fluctuations in currency exchange rates, interest rates, or economic downturns.
Definition of "Material Adverse Change" as a legal or regulatory issue
This definition ties "Material Adverse Change" to legal or regulatory issues.
"Material Adverse Change" refers to any legal, regulatory, or governmental event, decision, or action that has a material adverse impact on the party's ability to operate or fulfill its obligations under this agreement, including changes in laws, regulations, or taxation.
Definition of "Material Adverse Change" as a negative event for a business
This definition connects "Material Adverse Change" to negative events affecting a business.
"Material Adverse Change" means any event or circumstance that significantly harms the business, financial condition, operations, or prospects of a party, which could reasonably be expected to have a long-term detrimental effect on its ability to meet obligations.
Definition of "Material Adverse Change" as an environmental issue
This definition links "Material Adverse Change" to environmental issues.
"Material Adverse Change" refers to any environmental change or event, such as natural disasters, environmental violations, or changes in environmental laws, that materially and adversely impacts the operations, reputation, or financial condition of a party.
Definition of "Material Adverse Change" as a market disruption
This definition ties "Material Adverse Change" to market disruption.
"Material Adverse Change" means any significant disruption in the market conditions or industry environment, including a drastic reduction in market demand, loss of customers, or significant competitive changes, that adversely affects the party’s business or financial stability.
Definition of "Material Adverse Change" as a credit-related event
This definition connects "Material Adverse Change" to credit-related events.
"Material Adverse Change" refers to any event that negatively impacts the creditworthiness of a party, including the downgrading of its credit rating, increased borrowing costs, or the imposition of significant financial or credit restrictions.
Definition of "Material Adverse Change" as a decline in assets
This definition links "Material Adverse Change" to a decline in assets.
"Material Adverse Change" means a significant decline in the value or liquidity of a party’s assets, including the impairment or deterioration in the value of tangible or intangible assets, that materially affects the party’s ability to perform under this agreement.
Definition of "Material Adverse Change" as a contractual breach
This definition ties "Material Adverse Change" to a breach of contract.
"Material Adverse Change" refers to any event or condition that results in a breach or potential breach of the party’s obligations under this agreement, which materially impairs the party’s ability to fulfill its contractual commitments.
Definition of "Material Adverse Change" as a financial crisis
This definition connects "Material Adverse Change" to a financial crisis.
"Material Adverse Change" means a financial crisis or severe downturn in the global or national economy, which adversely impacts the business, operations, or financial position of a party to the extent that it could threaten the continuation of the agreement.
Definition of "Material Adverse Change" as a change in control
This definition links "Material Adverse Change" to a change in control.
"Material Adverse Change" refers to a change in control or ownership of a party, including mergers, acquisitions, or ownership shifts, that materially disrupts the party’s ability to perform its obligations under the agreement.
Definition of "Material Adverse Change" as a workforce disruption
This definition ties "Material Adverse Change" to workforce disruptions.
"Material Adverse Change" refers to any significant disruption in the workforce, including strikes, labor disputes, or mass layoffs, that materially impairs the party’s ability to operate its business or meet its obligations under the agreement.
Definition of "Material Adverse Change" as a technological failure
This definition connects "Material Adverse Change" to technological failures.
"Material Adverse Change" means a significant technological failure or breach, such as a cyberattack or data breach, that materially disrupts the party’s operations, data security, or ability to meet contractual obligations.
Definition of "Material Adverse Change" as an insurance-related issue
This definition links "Material Adverse Change" to insurance matters.
"Material Adverse Change" refers to any event that negatively impacts the party’s insurance coverage, such as the loss of essential coverage, significant increases in premiums, or claims that materially affect the party’s ability to perform.
Definition of "Material Adverse Change" as a supply chain disruption
This definition ties "Material Adverse Change" to supply chain disruptions.
"Material Adverse Change" refers to any disruption in the supply chain, such as the failure of a critical supplier, that materially affects the ability of a party to meet its obligations or continue its operations under this agreement.
Definition of "Material Adverse Change" as a loss of key personnel
This definition connects "Material Adverse Change" to the loss of key personnel.
"Material Adverse Change" means the loss of key personnel or executives critical to the operation or performance of a party, which materially affects the ability of the party to fulfill its obligations or continue operations.
Definition of "Material Adverse Change" as an insolvency event
This definition links "Material Adverse Change" to insolvency events.
"Material Adverse Change" refers to any event indicating that a party is in financial distress or insolvency, such as the filing of bankruptcy or the appointment of a receiver, that materially affects the party’s ability to meet obligations under the agreement.
Definition of "Material Adverse Change" as a government intervention
This definition ties "Material Adverse Change" to government intervention.
"Material Adverse Change" refers to any action by a government or regulatory body, such as sanctions or regulatory changes, that materially impairs the ability of a party to conduct business or perform under the agreement.
Definition of "Material Adverse Change" as a natural disaster
This definition ties "Material Adverse Change" to a natural disaster.
"Material Adverse Change" refers to any natural disaster, such as earthquakes, floods, hurricanes, or wildfires, that has a material and adverse effect on a party's operations, financial condition, or ability to fulfill its obligations under this agreement.
Definition of "Material Adverse Change" as a market crash
This definition connects "Material Adverse Change" to a market crash.
"Material Adverse Change" means any market crash, such as a sudden decline in stock prices, bond yields, or commodity prices, that materially and adversely affects the business, financial condition, or operations of a party.
Definition of "Material Adverse Change" as a liquidity crisis
This definition links "Material Adverse Change" to a liquidity crisis.
"Material Adverse Change" refers to a liquidity crisis that prevents a party from obtaining sufficient financing or credit, thereby materially and adversely affecting its ability to fulfill its contractual obligations.
Definition of "Material Adverse Change" as a technological advancement
This definition ties "Material Adverse Change" to a technological advancement.
"Material Adverse Change" means any significant and unexpected technological advancement or innovation that negatively impacts the business or market position of a party, making its products, services, or business model obsolete.
Definition of "Material Adverse Change" as a supply chain breakdown
This definition connects "Material Adverse Change" to a supply chain breakdown.
"Material Adverse Change" refers to a breakdown in the supply chain, including the failure of key suppliers or logistics disruptions, that materially affects the ability of a party to meet its contractual obligations.
Definition of "Material Adverse Change" as a credit event
This definition links "Material Adverse Change" to a credit event.
"Material Adverse Change" means any credit event, such as the downgrading of the party’s credit rating or a substantial increase in its borrowing costs, that materially and adversely affects the party's financial condition or ability to fulfill its obligations.
Definition of "Material Adverse Change" as a tax event
This definition ties "Material Adverse Change" to a tax event.
"Material Adverse Change" refers to any significant change in the tax laws or tax rates that adversely affects the business or financial condition of a party, or that materially increases the party’s tax liabilities under this agreement.
Definition of "Material Adverse Change" as an environmental disaster
This definition connects "Material Adverse Change" to an environmental disaster.
"Material Adverse Change" refers to any environmental disaster, such as an oil spill, chemical leak, or industrial accident, that results in significant financial or operational harm to a party, or that threatens its ability to fulfill its obligations under the agreement.
Definition of "Material Adverse Change" as a governmental decree
This definition links "Material Adverse Change" to a governmental decree.
"Material Adverse Change" means any decree, order, or other governmental action that materially adversely affects a party’s ability to conduct business, such as restrictions on trade, foreign exchange controls, or changes in national policies.
Definition of "Material Adverse Change" as an unforeseen event
This definition ties "Material Adverse Change" to an unforeseen event.
"Material Adverse Change" refers to any unforeseen event, whether natural or man-made, that significantly disrupts the business or financial stability of a party, and that materially impairs its ability to fulfill obligations under this agreement.
Definition of "Material Adverse Change" as an economic downturn
This definition connects "Material Adverse Change" to an economic downturn.
"Material Adverse Change" means any sudden and significant economic downturn or recession that materially and adversely affects the business, financial condition, or operations of a party.
Definition of "Material Adverse Change" as a loss of key assets
This definition links "Material Adverse Change" to the loss of key assets.
"Material Adverse Change" refers to the loss of key assets or property, whether through sale, damage, or theft, that materially disrupts the ability of a party to operate or meet its obligations.
Definition of "Material Adverse Change" as a legal claim
This definition ties "Material Adverse Change" to a legal claim.
"Material Adverse Change" means any legal claim, lawsuit, or other legal action that could result in significant financial loss or operational disruption, thereby impairing a party’s ability to perform under this agreement.
Definition of "Material Adverse Change" as a market trend
This definition connects "Material Adverse Change" to a market trend.
"Material Adverse Change" refers to any negative shift in market trends, such as a decline in demand, customer behavior, or competition, that materially affects the business and financial stability of a party.
Definition of "Material Adverse Change" as a product failure
This definition links "Material Adverse Change" to a product failure.
"Material Adverse Change" refers to a failure in a critical product or service offering, leading to significant operational disruption or reputational harm, which materially affects the ability of a party to meet obligations.
Definition of "Material Adverse Change" as a cyber attack
This definition ties "Material Adverse Change" to a cyber attack.
"Material Adverse Change" means any cyber attack, data breach, or information security incident that materially impacts the business operations, financial condition, or reputation of a party.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.