Employee Do Not Compete Agreement
This agreement is a contract between employer and
employee, prohibiting the employee from working
in the same line of business and area as the
employer for a legitimate period of time after the
employee leaves
Who should use this document?
Lawyers
Employers/Employees
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EMPLOYEE DO NOT COMPETE AGREEMENT –
GEOGRAPHIC REGIONS
THIS NON COMPETE AGREEMENT (this "Agreement"), effective as of
____________,20___ (“Effective Date”), between ___________________, a company
organized and existing under the laws of __________________ (the "Company"), and
________________________, residing at _______________________(the "Employee").
RECITALS
I. WHEREAS Employee has been offered employment by Company for the position
of _______________and has entered into an agreement (the “Employment
Agreement”);
II. WHEREAS Parties deem it in their respective interests to enter into an agreement
providing the obligation of non-compete for the Employee.
WITNESSETH
In consideration of the mutual promises and agreements contained herein, and for
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. COVENANT NOT TO COMPETE
Employee hereby agrees that, during the term of employment under the
Employment Agreement and for a period of one (____1) year [Please note that
different States have their own specific period for a non-compete to be
enforceable] thereafter (the “Restrictive Period”), whether with or without good
cause or for any or no cause, at the option either of the Company or the
Employee, with or without notice, the Employee will not compete with the
Company and its successors and assigns, without the prior written consent of the
Company. The Employee shall not:
1.1. Alone, with and/or through others, be, become or function as an officer, director,
Employee, owner, corporate affiliate, salesperson, co-owner, partner, trustee,
promoter, founder, technician, engineer, analyst, employee, agent, representative,
distributor, re-seller, sub-licensor, supplier, investor or lender, consultant, advisor
or manager of or to, or otherwise acquire or hold any interest in or otherwise
engage in the provision of services to, any person or entity that engages in a
business that is Directly Competitive (as defined below); provided, however, that
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Employee may work exclusively for a division, entity or subgroup of such a
business if the division, entity or subgroup is not Directly Competitive; or
1.2. Authorize Employee’s name to be used in connection with a business that is
Directly Competitive;
For purposes of this Agreement, “Directly Competitive” means developing,
manufacturing, providing, marketing, distributing or otherwise commercially
exploiting any products, services or technology that compete with the Company’s
products, services or technology in existence as of the Effective Date or the
foregoing products, services or technology as such may be developed, enhanced
or modified by the Company after the Effective Date.
1.3. Engage in or participate in, directly or indirectly, any business conducted under
any name that shall be the same as or similar to the name of the Company or any
trade name used by it that is (i) Directly Competitive (or indirectly ) with the
business of the Company or (ii) engaged in any related activity where the use of
such name is reasonably likely to result in confusion; and
1.4. Transfer, sell, assign, pledge, hypothecate, give, create a security interest in or lien
on, place in trust (voting or otherwise), or in any other way dispose of more than
1% of total outstanding shares of the Company as of the date of said disposition in
one or a series of related transactions directly owned of record by the Employee
to any person which is competitive with any significant aspect of the business of
the Company, which, measured by revenue generated, accounts at least 10% of
the Company's business.
2. LIMITED GEOGRAPHIC SCOPE
2.1. This Agreement shall cover the Employee’s activities in every part of the
Territory in which the Employee may conduct business during the term of the
Employment Agreement. “Territory” shall mean (i) all counties in the State of
__________________________, (ii) all other states of the United States of
America and (iii) all other countries of the world; provided that, with respect to
clauses (ii) and (iii) in this paragraph, the Company derives at least ___ percent
(__%) of its gross revenues from such geographic area prior to the date of the
expiration or termination of the Agreement.
3. VIOLATION OF THIS AGREEMENT
3.1. In the event the Employee does not comply with the terms of this Agreement, the
Company reserves the right to discharge the Employee as an employee.
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Furthermore, the Company reserves the right to recover monetary damages from
the Employee, and the Company may also recover punitive damages to the extent
permitted by law. In the event that monetary damages are an inadequate remedy
for any harm suffered by the Company as a result of a breach of this Agreement
by the Employee, the Company may also seek other relief, including an order of
specific performance or injunctive relief.
3.2. The Employee further agrees to indemnify and hold the Company harmless from
any damages, losses, costs or liabilities (including legal fees and the costs of
enforcing this indemnity agreement) arising out of or resulting from failure of the
Employee to abide by the terms of this Agreement.
4. MISCELLANEOUS
4.1. Notices. All notices and other communications required or permitted under this
Agreement shall be in writing and shall be either hand delivered by messenger in
person, sent by facsimile, sent by certified or registered first-class mail, postage
pre-paid, or sent by nationally recognized express courier service. Such notices
and other communications shall be effective upon receipt delivered by messenger
or sent by facsimile, five days after mailing if sent by mail, and one day after
dispatch if sent by express courier, to the following addresses, or such other
addresses as any party may notify the other parties in accordance with this Section
5.1.
If to Company: __________________
If to Employee: __________________
4.2. Amendments. This Agreement may not be changed or modified in whole or in
part except by a writing signed by the party against whom enforcement of the
change or modification is sought.
4.3. Successors and Assigns. This Agreement and all rights and obligations hereunder
are personal to Employee and may not be transferred or assigned by Employee at
any time. Company may assign its rights, together with its obligations hereunder,
to any entity or person.
4.4. Governing Law and Jurisdiction. This Agreement will be governed by and
interpreted according to the substantive laws of the State of
______________without regard to such state’s conflicts laws. Parties hereby
expressly consent to the exclusive jurisdiction of the state and federal courts
located within _______ County, in the state of __________, USA with respect to
the interpretation and enforcement of the provisions of this Agreement.
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4.5. No Waiver. No failure on the part of Company or Employee to exercise any
power, right, privilege or remedy under this Agreement, and no delay on the part
of Company or Employee in exercising any power, right, privilege or remedy
under this Agreement, shall operate as a waiver of such power, right, privilege or
remedy; and no single or partial exercise of any such power, right, privilege or
remedy shall preclude any other or further exercise thereof or of any other power,
right, privilege or remedy. Neither Company nor Employee shall be deemed to
have waived any claim arising out of this Agreement, or any power, right,
privilege or remedy under this Agreement, unless the waiver of such claim,
power, right, privilege or remedy is expressly set forth in a written instrument
duly executed and delivered on behalf of such party; and any such waiver shall
not be applicable or have any effect except in the specific instance in which it is
given.
4.6. Severability. Employee and Company recognize that the limitations contained
herein are reasonably and properly required for the adequate protection of the
interests of Company. If for any reason a court of competent jurisdiction or
binding arbitration proceeding finds any provision of this Agreement, or the
application thereof, to be unenforceable, the remaining provisions of this
Agreement will be interpreted so as best to reasonably effect the intent of the
parties. The parties further agree that a court of competent jurisdiction is
authorized to replace any such invalid or unenforceable provisions with valid and
enforceable provisions designed to achieve, to the maximum extent possible, the
business purposes and intent of such unenforceable provisions, all other
provisions continuing in full force and effect.
4.7. Counterparts. This Agreement may be executed in counterparts which when
taken together will constitute one instrument. Any copy of this Agreement with
the original signatures of all parties appended will constitute an original.
4.8. Headings. The headings contained in this Agreement are for convenience of
reference only, shall not be deemed to be a part of this Agreement and shall not be
referred to in connection with the construction or interpretation of this Agreement.
4.9. Entire Agreement. This Agreement constitutes the entire understanding and
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior and contemporaneous agreements or understandings,
inducements or conditions, express or implied, written or oral, between the parties
with respect to the subject matter hereof.
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4.10. Binding Effect. This Agreement will be binding upon Employee and Employee’s
representatives, executors, administrators, estate, heirs, successors and assigns,
and will inure to the benefit of Company and its successors and assigns. The
parties agree that this Agreement shall not be interpreted against either party
solely because this Agreement was drafted by attorneys for Company.
5. ACKNOWLEDGMENT
By signing this Agreement, the Employee acknowledges that, in consideration of the
substantial benefits the Employee will receive as the Company's employee, the terms
contained in this Agreement are necessary and reasonable in all respects and that the
restrictions imposed on the Employee are reasonable and necessary to protect the
Company's legitimate business interests. Additionally, the Employee hereby
acknowledges and agrees that the restrictions imposed on the Employee by this
Agreement will not prevent the Employee from obtaining employment in its field of
expertise or cause the Employee undue hardship.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
[Company]
By:
--------------------------------
Title:
ACCEPTED AND AGREED TO:
By:
--------------------------------
Name:
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