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Ancillary Agreements Definition

As businesses grow and expand, they often enter into a multitude of different agreements with various parties. These agreements may include contracts with suppliers, distributors, or even employees. Among these agreements are ancillary agreements.

An ancillary agreement is a contract that is entered into in support of a larger or primary contract. These agreements are generally considered to be supportive or complementary in nature. They are usually created to address specific issues or concerns that may arise during the course of the primary agreement.

Ancillary agreements can take many forms, depending on the nature of the primary contract. Examples of ancillary agreements include confidentiality agreements, non-disclosure agreements, indemnification agreements, and assignment agreements. Each of these agreements serves a specific purpose and is designed to provide additional protection or benefits to one or more parties involved in the primary contract.

Confidentiality agreements are a common ancillary agreement that is used to protect the confidentiality of sensitive information shared between parties. These agreements stipulate that the information exchanged between parties will be kept confidential and may not be disclosed to any third parties.

Non-disclosure agreements are similar to confidentiality agreements, with the main difference being that they are broader in scope. Non-disclosure agreements can be used to protect confidential information, trade secrets, or other intellectual property.

Indemnification agreements are also common ancillary agreements that are used to protect parties from liability. These agreements stipulate that one party will indemnify the other party against any losses or damages that may arise from the primary agreement.

Assignment agreements are used to transfer ownership or rights from one party to another. These agreements are often used when a company is acquired or when there is a change in ownership.

In summary, ancillary agreements are important contracts that support and complement primary contracts. These agreements can take many forms and serve a variety of purposes, from protecting confidential information to transferring ownership or rights. It is important for businesses to understand the role of ancillary agreements in their contracts and to ensure that they are properly drafted and executed.