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Readyshare Vault delete older files

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What does "delete file versions older than 1 year" mean in Readyshare Vault  backup options?

If there are 2 versions of a file and I set to "delete file versions older than 1 year" in the backup options, will the older versions of the file be erased after 1 year and leave the most current version of that file in the vault forever? 


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