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This deceptively simple node is designed to add Material components together to create new, custom materials. The node has no interface, just two inputs counterintuitively named, and a single Material output.
Because LightWave wants to start evaluating any stack of material components from the bottom to the top, the inputs are so ordered. Inputting different Material components can create materials impossible otherwise, or can enhance existing materials - if you want a carpaint whose clearcoat can be more actively controlled, use Layer Materials to join a Carpaint material with a GGX BRDF to create a unique iridescent Clearcoat finish like so: