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Non-circumvention aqgreement?

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by matseng

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Hi all!

Can anyone please tell me in simple words what this agreement really is about? The company that tried to get me to sign this claimed that it is nothing more than a standard non-disclosure agreement. But to me it looks more like a non-compete agreement.

Any thoughts on this?

/Mats

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NON-CIRCUMVENTION AGREEMENT
Agreement between IB Inc and Draft AB

1) Draft AB hereby undertakes and agrees not to circumvent the party of the other party by making any contract with ordealing in any manner (information given pertain to, specifications, verbal or written descriptions), directly ot indirectly, with the other partys principal(s), or any other person, firm, corporation, or other antity to which Draft AB may be introduced to by IB.

2) Any contact by the parties with aby of the antities identified in paragraph 1 above, other than for the herein stated purpose, must be agreed to by the other party in writing.

3) This proscription shall be binding upon the parties, their principals, and their subsidiaries, affiliates, employees, agents, consultants, partners, shareholders and other related persons for a period of five years from the date of this agreement.

4) Any other contact referred to in paragraph 3 hereof shall mean and include followups, repeats, rollovers, extensions, addidtions, or extended or renegotiated transactions pertaining in any way to the initial transaction as well as any entirely new transactions involving the same parties, any entirely new transactions involving the same parties, whether or not the initial or any subsequent transaction was successful.

5) This agreement shall be bindning upon and insure to the benefit of the parties hereto, their heirs, successors and assigns

4 replies

by james r linn

It prevents you from non-competion and it prevents you from working for IB's customers/suppliers etc. This is fairly drastic given the 5 year term. I've seen 2 years as common.

What it attempts to do is bind you to the company and make sure you don't drop them to work at one of the suppliers/customers etc.That kind of event happens alot - customer A finds out that you aren't an employee but a contractor and thinks that they can get a leg up and cut some support/maintenance costs by buying you.

Its not a non-disclosure and its not that common.

James

by rzan

Signing a contract like this is like selling your soul to the devil. It will only serve to damage your career if you bind yourself to such a stupid condition. If they insist, turn down the job offer and look for another company that doesn't imposethese rediculous conditions on you. This is a free country, built on capitalism, and you should be free to recieve income or revenue from anyone you work for, and not be prevented to do so based on some stupid contract. Tell them to stick the contract where the sun don't shine.

by epepke

If this is a body shop or consulting firm, the basic idea is reasonable. They want to collect their fee. However, the 5-year limit is totally insane.

If this is a regular firm, then you're right--it's a non-compete agreement. The 5-year term is then doubly insane.

by matseng

OK, is was as I suspected then.

I didn't sign the contract and demanded a standard plain NDA. After a lot of grumbling and mumbling about that at least 600 companies had signed it without any problems, they gave in and let me sign an ordinary NDA instead.

/Mats

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