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Non-Circumvention Agreement Basics

A Non-Circumvention Agreement is an important business tool that can protect businesses from being taken advantage of. In this situation, a party (the disclosing party) discloses proprietary information regarding a business opportunity to another party (the receiving party). This document ensures that in the event that the disclosing party's business contacts are revealed to the recipient, those contacts will remain confidential and the recipient cannot go behind the disclosing party's back and circumvent its business to engage directly with those contacts.

Use the Non-Circumvention Agreement document if:

  • You're contracting with another business in a similar field.
  • Your list of clients and business partners is both valuable and secret.

Once this agreement is agreed to and signed by all parties, the violating party will be liable to pay for penalty fees of the amount that the disclosing party would have received had the contract not been violated, and even more in some cases.

A Non-Circumvention Agreement should include provisions that (i) require amendments (changes) to the agreement to be in writing and signed by both parties, (ii) specify the state laws that will govern and interpret disputes between the parties regarding the matters covered by the agreement, and (iii) prohibit the parties from assigning their obligations under the agreement to third parties. Generally, the state laws that govern the agreement should be the state of the disclosing party or the recipient.


Sample Non-Circumvention Agreement

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Non-Circumvention Agreement Basics

Once this agreement is agreed to and signed by all parties, the violating party will be liable to pay for penalty fees of the amount that the disclosing party would have received had the contract not been violated, and even more in some cases.

A Non-Circumvention Agreement should include provisions that (i) require amendments (changes) to the agreement to be in writing and signed by both parties, (ii) specify the state laws that will govern and interpret disputes between the parties regarding the matters covered by the agreement, and (iii) prohibit the parties from assigning their obligations under the agreement to third parties. Generally, the state laws that govern the agreement should be the state of the disclosing party or the recipient.

Use the Non-Circumvention Agreement document if:
  • You're contracting with another business in a similar field.
  • Your list of clients and business partners is both valuable and secret.
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