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Business Restrictions Template

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Business Restrictions Template

This Business Restrictions Agreement (the "Agreement") is entered into as of by and between Client Name: with address and Contractor Name: with address .

RECITALS

WHEREAS, Client engages in the business of providing certain products and services that involve confidential information, customer relationships, and goodwill; and

WHEREAS, Contractor will provide services and/or access to Client information in connection with the business relationship, and Client desires to impose reasonable restrictions to protect its legitimate business interests; and

NOW, THEREFORE, in consideration of the mutual covenants set forth herein and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows.

SCOPE OF WORK

RESTRICTIVE COVENANTS

1. Non-Compete. During the Term of this Agreement and for a period of following termination, Contractor shall not, directly or indirectly, own, manage, operate, join, control, be employed by, consult with, or otherwise assist any business that engages in the Restricted Activities within the Geographic Area defined below.

2. Non-Solicitation. During the Term and for thereafter, Contractor shall not solicit or attempt to solicit, directly or indirectly, any employee, contractor, or client of Client with whom Contractor had material contact during the Term.

PAYMENT TERMS

Late payments shall incur a late fee equal to % per month on the outstanding balance, or the maximum permitted by law, whichever is less. Client reserves the right to suspend obligations under this Agreement for nonpayment.

TERM AND TERMINATION

This Agreement commences on Start Date: and expires on End Date: , unless earlier terminated as provided herein.

Either party may terminate this Agreement for material breach by the other party upon written notice and a day period to cure. For convenience, either party may terminate upon days' prior written notice.

CONFIDENTIALITY

Contractor acknowledges that Contractor will receive Confidential Information. Contractor shall not disclose, use, copy, or permit the use of Confidential Information except as necessary to perform obligations under this Agreement. Confidential Information does not include information that is: (a) in the public domain through no breach by Contractor; (b) rightfully received from a third party without restriction; or (c) independently developed without use of Client's Confidential Information.

Upon termination or upon Client's request, Contractor shall promptly return or destroy all Confidential Information and certify in writing that all copies have been returned or destroyed.

REMEDIES; INJUNCTIVE RELIEF

Contractor acknowledges that a breach of the restrictive covenants or confidentiality provisions would cause irreparable harm to Client for which monetary damages are inadequate. Accordingly, Client shall be entitled to equitable relief, including injunctive relief, without posting bond, in addition to any other remedies available at law or in equity.

MISCELLANEOUS

Assignment: Neither party may assign this Agreement without the prior written consent of the other, except that Client may assign to an affiliate or successor in interest.

Severability: If any provision is held invalid or unenforceable, the remaining provisions shall remain in full force and effect and the invalid provision shall be reformed to the minimum extent necessary to make it enforceable.

Amendment: This Agreement may be amended only by a written instrument executed by both parties.

GOVERNING LAW; ENTIRE AGREEMENT

This Agreement shall be governed by and construed in accordance with the laws of without regard to conflict of law principles. The parties consent to exclusive jurisdiction in the courts located within that jurisdiction.

Entire Agreement: This Agreement (together with any schedules or exhibits expressly incorporated herein) constitutes the entire agreement between the parties with respect to the subject matter and supersedes all prior and contemporaneous agreements and understandings, whether written or oral.

Client Printed Name:

By:

Date:

Contractor Printed Name:

By:

Date:

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What a Business Restrictions Template Is and When It Applies

A Business Restrictions Template is a standardized contractual form used to record limits on business activities, territory, customers, or competing operations between parties. Typical uses include non-compete covenants, non-solicitation clauses, territorial limits, confidentiality-linked activity restrictions, and vendor exclusivity provisions. The template provides consistent language for identifying parties, describing restricted activities, setting time and geographic scope, and documenting remedies. For U.S. transactions the template can be executed electronically under the ESIGN Act (15 U.S.C. ch. 96) or applicable state UETA statutes when state law governs intrastate transactions.

Why a Clear Template Matters for Risk and Enforcement

Using a clear, tailored Business Restrictions Template reduces ambiguity about scope, duration, and enforcement remedies, which improves defensibility in disputes and simplifies internal approvals.

Why a Clear Template Matters for Risk and Enforcement

Who Typically Prepares and Signs These Templates

Tailor the template to role-specific needs and confirm who at the company has authority to approve the final version before circulation.

  • Small and midsize businesses: use templates to standardize non-compete and confidentiality language across offices and franchises.
  • In-house legal teams and outside counsel: adapt clauses to state law and industry requirements before execution.
  • HR and operations managers: collect and track signed restrictions for employees and contractors.

Core Sections to Include in a Professional Business Restrictions Template

A complete template organizes restrictions into clear sections so each obligation and remedy is easy to find. Consistent labels and defined terms prevent interpretive disputes.

Parties

Identify full legal names and entity types for every contracting party, including any DBAs or affiliated entities.

Restricted Activities

Precisely describe prohibited actions (e.g., soliciting customers, performing specified services, using confidential information).

Geographic Scope

State the precise territory (zip codes, counties, or 'nationwide') and any carve-outs or permitted markets.

Time Limits

Specify start and end dates or triggering events; include tolling rules for leaves or suspensions.

Consideration

Document consideration exchanged (salary, severance, buyer payment) to support enforceability.

Remedies

Outline injunctive relief, liquidated damages, attorneys' fees, and dispute resolution procedures.

Required Information and Standard Fields

Party Names: Full legal names
Addresses: Street, city, state, ZIP
Effective Date: MM/DD/YYYY
Scope Language: Activity descriptions
Duration: Start/end
Signature Blocks: Signer name and title

Step-by-Step: Filling and Finalizing a Business Restrictions Template

Complete fields methodically, confirm legal review, and execute with appropriate authentication and retention steps.

  • 01
    Prepare Draft: Populate parties, restrictions, and dates before sharing.
  • 02
    Legal Review: Have counsel validate enforceability under state law.
  • 03
    Signatures: Collect signatures with identified signer authentication.
  • 04
    Store Records: Archive signed copies in secure repository.

How to Configure an Online Signing Workflow

Map out roles and authentication settings before sending the template for signature to reduce routing errors.

Field Configuration
Signer Order Sequential or parallel routing
Authentication Email, SMS code, or KBA
Conditional Fields Show/hide fields based on prior responses
Audit Trail Enable IP and timestamp logging

Where to Send, File, or Submit the Completed Template

Decide the final destination for signed copies and whether a filing or registry entry is required in your jurisdiction.

  • Internal Records: Company contract repository or HR file
  • Counterparty: Return fully executed copy to all signers
  • Regulatory Filings: File with secretary of state if tied to transaction
  • Third Party Notice: Provide notice to lenders or partners if required

Digital Signing and Technical Distribution Options

Ensure the chosen solution can produce a complete audit trail and export signed records to your records management system.

  • File Formats: PDF, DOCX
  • Integrations: Salesforce, NetSuite, Google Workspace
  • Security: TLS in transit; AES-256 at rest

Typical Timing, Deadlines, and Processing Expectations

Timelines depend on negotiation, review cycles, and whether filing or third-party notice is required — plan accordingly.

Execution Deadline:

Agree on a signing window such as 7–30 days

Legal Review Period:

Allow 3–10 business days for counsel review

Filing Window:

If filing required, follow state-specific timing

Notice Period:

Amendment or waiver notice often 30–90 days

Record Availability:

Signed copy should be accessible immediately after completion

Common Mistakes to Avoid When Preparing This Template

  • Vague scope language that makes duties unclear and invites litigation.
  • Missing consideration or failing to document what was provided in exchange.
  • Using overly broad geographic limits that courts may find unreasonable.
  • Failing to confirm signatory authority for corporate signers, causing execution defects.

Penalties and Legal Risks of an Incorrect or Incomplete Template

Unenforceability: Risk of court invalidation
Monetary Damages: Liability for breach
Injunction: Court-ordered restraints
Reputational Harm: Business relationship damage
Regulatory Penalties: Industry-specific sanctions
Backup Withholding: Tax consequences for missing TIN

Download, Export, and Supporting Documents to Include

Prepare supporting exhibits and choose export formats that retain signatures and audit evidence for records and audits.

Export Formats

Provide signed copies as PDF/A to preserve signatures and ensure long-term readability.

Supporting Exhibits

Attach customer lists, geographic maps, and exception schedules referenced in the restriction clauses.

Audit Evidence

Retain the audit trail showing timestamps, IP addresses, and signer authentication method.

Storage Location

Store in secure contract repository with access controls and backup.

Who Typically Signs and What Authority Is Required

General Counsel

In-house counsel typically reviews and signs off on legal language; they confirm enforceability and ensure the company has delegated authority for restrictive covenants. They also decide whether outside counsel review is necessary when entering new jurisdictions.

Business Owner

An authorized officer or business owner signs for the company and must be listed with title. Signatory authority should match corporate bylaws or board resolutions to avoid execution defects.

Practical Tips for Accurate and Efficient Completion

Follow these best practices to reduce negotiation cycles and legal risk when using a Business Restrictions Template.

Draft Precisely
Write narrowly tailored restrictions tied to legitimate business interests; this increases the chance a court will enforce the clause and reduces litigation risk.
Document Consideration
Record the specific consideration supporting the restriction to strengthen contract validity, particularly in employee agreements.
Verify Authority
Confirm signers have authority to bind their organizations and capture titles and company formation details where relevant.
Use Consistent Definitions
Define terms like 'Customer' and 'Territory' once and reuse them to avoid inconsistent interpretations across sections.

Real-World Examples of Template Use

These short examples illustrate how organizations adapt the template to common situations without revealing confidential specifics.

Optica Ventures

A small investment firm standardized non-solicitation language across portfolio companies to simplify exits and transitions.

  • The change reduced review times for new hires.
  • "The interface is simple and easy-to-use for our team; more importantly, it is just as easy for our customers."

Martin Properties

A regional property manager used the template for vendor exclusivity and territory carve-outs to streamline contracting.

  • Implementation reduced negotiation points.
  • "I can process and execute all of these documents online with 100% compliance and built-in security."

Comparison: eSignature Vendors for Executing Business Restrictions

Common vendor considerations include price, bulk sending, audit trails, HIPAA support, and envelope or session limits when executing many agreements.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial 7-day trial Varies by plan Varies by plan Varies by plan Varies by plan
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No
Envelope Cap No cap 100 envelopes/user/year Varies by plan Varies by plan Varies by plan

FAQs — Common Questions About Using the Business Restrictions Template

Answers to frequent questions about enforceability, signatures, and recordkeeping when using a template for restrictions.


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