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An exclusivity clause is a contractual commitment to engage exclusively with one party for specific actions, such as designating a sole supplier for a resource. For example, a contract may state that a company will purchase all its water exclusively from a single supplier in North America for a designated period, even if the term "exclusive" isn't explicitly mentioned. While not widely prevalent, these clauses often emerge in significant business agreements where they can hold substantial financial value, such as being the exclusive distributor or licensee of products in specific markets. Violating these clauses can have serious consequences.
