The Non Compete Disclosure Agreement is a crucial legal instrument used in Australian business contexts where an organization needs to protect its competitive advantages and confidential information. This document is typically implemented when engaging employees, contractors, or business partners who will have access to sensitive business information or whose future competitive activities could potentially harm the business. It combines two essential protective elements: restrictions on future competitive activities and obligations regarding confidential information. The agreement must be carefully drafted to ensure compliance with Australian competition law and reasonable restraint of trade principles, including appropriate temporal and geographical limitations. Common scenarios for its use include senior executive appointments, business sales, partnership arrangements, and contractor engagements where protection of business interests is paramount.
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1. Parties: Identifies and defines the parties entering into the agreement
2. Background: Sets out the context and purpose of the agreement, including the nature of the business relationship
3. Definitions: Defines key terms used throughout the agreement, including 'Confidential Information', 'Competing Business', 'Restricted Period', etc.
4. Confidentiality Obligations: Details the obligations regarding confidential information, including use, storage, and protection requirements
5. Non-Compete Covenants: Specifies the scope of restricted activities, duration, and geographical limitations of the non-compete obligations
6. Non-Solicitation: Prohibitions on soliciting employees, customers, or suppliers
7. Return of Confidential Information: Requirements for returning or destroying confidential information upon termination or request
8. Duration and Territory: Specific timeframes and geographical areas where restrictions apply
9. Breach and Remedies: Consequences of breach and available remedies including injunctive relief
10. General Provisions: Standard contractual terms including governing law, severability, and entire agreement
1. Intellectual Property: Additional provisions regarding IP rights and ownership - include when IP is a significant concern
2. Permitted Disclosures: Exceptions to confidentiality obligations - include when specific exceptions need to be carved out
3. Independent Contractor Relationship: Clarification of relationship status - include when agreement is with contractors rather than employees
4. Garden Leave: Provisions for paid non-compete period - include when applicable to senior executives
5. Survival: Specific terms that continue after agreement termination - include when certain obligations should extend beyond the agreement
6. Assignment and Delegation: Rights to transfer obligations - include when assignment flexibility is needed
1. Schedule 1 - Restricted Activities: Detailed list of specific activities that are prohibited under the non-compete provisions
2. Schedule 2 - Confidential Information: Detailed description of the types of confidential information covered
3. Schedule 3 - Restricted Territory: Maps or detailed description of geographical areas where restrictions apply
4. Schedule 4 - Restricted Clients/Customers: List of specific clients or customers covered by non-solicitation provisions
5. Appendix A - Acknowledgment Form: Form for acknowledging receipt and understanding of the agreement
6. Appendix B - Return of Information Certificate: Certificate confirming return/destruction of confidential information
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