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Legal NSA Agreement

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LEGAL NSA AGREEMENT

This Non-Solicitation Agreement (the "Agreement") is made as of Effective Date: between Company Name: , a , with principal place of business at , and Counterparty Name: , a , with principal place of business at (each a "Party" and collectively the "Parties").

RECITALS

WHEREAS, Company and Counterparty desire to protect the stability of their workforces and client relationships and have agreed to certain restrictions on solicitation; and

WHEREAS, during the course of the business relationship, each Party may obtain access to employees, contractors, clients and confidential information of the other Party; and

WHEREAS, the Parties desire to set forth the terms and conditions under which solicitation of the other Party's employees and customers is restricted.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1. DEFINITIONS

1.1 "Protected Employee" means any person who, within the twelve (12) months prior to the Effective Date or during the Term, was employed or engaged by a Party and about whom the other Party obtained confidential information or with whom the other Party had material business contact.

1.2 "Protected Customer" means any person or entity that, within the twelve (12) months prior to the Effective Date or during the Term, was a customer, client, or prospective client of a Party and with whom that Party had direct and material business dealings.

1.3 "Solicit" or "Solicitation" means any action, direct or indirect, taken for the purpose of inducing or attempting to induce an employee to terminate employment or a customer to cease or alter business with a Party, including recruitment, offers of employment, offers of engagement as an independent contractor, or targeted solicitations of business.

2. NON-SOLICITATION OF EMPLOYEES

2.1 For the Term defined in Section 5, neither Party shall, directly or indirectly, solicit for employment or engagement as an independent contractor any Protected Employee of the other Party. The prohibition includes inducing employees to terminate employment or materially changing their terms of engagement.

2.2 The restrictions in this Section shall not apply to: (a) general solicitations not targeted at employees of the other Party (such as general advertising or job postings); (b) hires of employees who respond to a general advertisement and were not specifically approached; or (c) employees whose employment with the other Party has been terminated for a period of days prior to such hire.

3. NON-SOLICITATION OF CUSTOMERS

3.1 For the Term, neither Party shall, directly or indirectly, (a) solicit or attempt to solicit business from any Protected Customer of the other Party for purposes of providing products or services competitive with those provided by the other Party, or (b) induce or attempt to induce a Protected Customer to reduce or cease its business with the other Party.

3.2 Protected Customers shall be limited to customers with whom the relevant Party had material contact within the preceding months.

3.3 The restrictions in this Section shall not apply to: (a) unsolicited responses to bona fide inquiries from prospective customers; or (b) customers who independently seek the services of the other Party without any targeted effort by the soliciting Party.

4. CONFIDENTIAL INFORMATION

4.1 Each Party acknowledges that in connection with performance under this Agreement it may receive Confidential Information of the other Party. Confidential Information includes, without limitation, non-public business information, customer lists, pricing and employee records.

4.2 Each Party agrees to protect Confidential Information with at least the same degree of care it uses to protect its own confidential information, but in no event less than reasonable care, and to use Confidential Information only for purposes permitted by this Agreement.

5. TERM AND SURVIVAL

5.1 The term of this Agreement shall commence on the Effective Date and shall continue for a period of months (the "Term"), unless earlier terminated in accordance with this Agreement.

5.2 The obligations in Sections 2, 3 and 4 shall survive termination of this Agreement for a period equal to the Term or as otherwise specified herein.

6. REMEDIES

6.1 The Parties acknowledge that any breach of Sections 2 or 3 will cause irreparable injury for which monetary damages may be inadequate. Accordingly, in addition to any other remedies available at law or in equity, the non-breaching Party shall be entitled to injunctive relief, specific performance and such other equitable relief as a court may deem appropriate.

6.2 The Parties agree that, without prejudice to injunctive relief, a prevailing Party is entitled to recover its reasonable attorneys' fees and costs in any enforcement action.

6.3 Liquidated Damages: If the Parties elect to set liquidated damages for a breach, the Parties may specify an amount per breach: .

7. REPRESENTATIONS

Each Party represents and warrants that it has full power and authority to enter into and perform its obligations under this Agreement, that execution of this Agreement has been duly authorized, and that the Agreement constitutes a valid and binding obligation enforceable against such Party.

8. NOTICES

Notices to Company:

Notices to Counterparty:

9. AMENDMENTS

No modification or amendment of this Agreement shall be effective unless in writing and signed by authorized representatives of both Parties.

10. WAIVER

The failure of either Party to exercise any right under this Agreement shall not constitute a waiver of that right or any other right. Any waiver must be in writing and signed by the Party granting the waiver.

11. SEVERABILITY

If any provision of this Agreement is held to be invalid, illegal or unenforceable by a court of competent jurisdiction, the parties shall negotiate in good faith to replace such provision with a valid provision that preserves, to the extent possible, the parties' original intent. The remainder of this Agreement shall remain in full force and effect.

12. GOVERNING LAW

This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to conflicts of law principles.

13. ENTIRE AGREEMENT

This Agreement constitutes the entire understanding between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, between the Parties.

14. COUNTERPARTS

This Agreement may be executed in counterparts, each of which when executed shall be deemed an original, and all of which together shall constitute one and the same instrument. Signatures delivered by electronic means shall be effective as original signatures.

Company:

By:

Date:

Counterparty:

By:

Date:

Enter text✕

What a Legal NSA Agreement Is and when it applies

A Legal NSA Agreement (commonly a non-solicitation agreement) is a contractual commitment that limits a party from soliciting a business’s employees, clients, or contractors for a defined period. It defines the protected relationships, the restricted activities, the term and geographic or customer scope, and remedies for breach. These agreements are governed by ordinary contract law and, when executed electronically, may meet federal and state e-signature rules such as the ESIGN Act (15 U.S.C. ch. 96) and state UETA statutes. Drafting must balance protection with reasonableness to be enforceable.

Why parties use a Legal NSA Agreement

A Legal NSA Agreement preserves client and employee relationships, protects goodwill and confidential information, and clarifies post-termination conduct. When narrowly tailored it reduces litigation risk and supports injunctive remedies while maintaining enforceability across most U.S. jurisdictions.

Why parties use a Legal NSA Agreement

Who typically prepares or signs an NSA

Employers, legal counsel, staffing firms, and business buyers commonly prepare or request an NSA when entering employment, acquisition, or contractor arrangements.

  • Human resources and talent teams who onboard and protect workforce relationships and trade secrets.
  • General counsel or outside attorneys who draft enforceable, jurisdiction-appropriate restrictive covenants.
  • Buyers and investors who require stability of customer lists and non-solicitation protections after transactions.

Multiple signers may be required: the corporate entity, an authorized officer, and any third parties bound by the restriction; authority to bind must be documented.

Authorized signers and typical reviewers

HR Director

An HR Director signs for operational enforcement and coordinates notice and tracking. They ensure employee acknowledgement, distribute signed copies, and preserve records for the retention period to support enforcement.

Company Counsel

Legal counsel reviews scope and state suitability, advises on enforceability, negotiates carve-outs for existing relationships, and recommends language to meet ESIGN/UETA standards when executed electronically.

Core elements to include in a professional NSA

A clear, narrowly drawn NSA improves enforceability. Include defined parties, scope of prohibited solicitation, duration, exceptions, remedies, and governing law to reduce ambiguity and litigation exposure.

Parties

Identify each contracting entity and any affiliates by full legal name to avoid ambiguity about who is bound or benefits from the restriction.

Restricted Activities

Describe prohibited actions precisely (e.g., soliciting named clients or classes of clients) rather than using broad or subjective phrasing.

Protected Relationships

Specify the customer, client, or employee groups covered; include objective criteria like last engagement date or account value where appropriate.

Term and Geography

State a reasonable duration and geographic scope tied to legitimate business interests to help maintain enforceability under state law.

Exceptions

List carve-outs for pre-existing relationships, public solicitations, or passive responses to inbound inquiries to avoid overbreadth.

Remedies

Include injunctive relief, liquidated damages if reasonable, and a fee-shifting clause where permitted to strengthen enforcement posture.

Essential security and compliance checkpoints

TLS Encryption: TLS 1.2/1.3
Data at Rest: AES-256
HIPAA: BAA required for PHI
Audit Trail: Detailed signing metadata
Certifications: SOC 2 Type II, ISO 27001
Accessibility: WCAG 2.0 Level AA

How to complete and finalize the NSA

Follow these practical steps to prepare, execute, and archive a legally sound NSA with minimal friction.

  • 01
    Draft: Define parties and scope in precise terms.
  • 02
    Review: Have counsel check state-specific enforceability.
  • 03
    Execute: Obtain authorized signatures and dates.
  • 04
    Archive: Store signed copy with audit trail and retention metadata.

Configure an online signing workflow for an NSA

Set up fields, signer order, and authentication to match internal approval and recordkeeping requirements before sending for signatures.

Field Configuration
Signature Block Required | Signer name | Date
Signer Order Sequential or parallel routing
Authentication Email link or SMS code
Retention Settings Save signed PDF + audit trail

Where signed NSAs should be sent and stored

After execution, route signed copies to legal, HR, and central records; preserve an immutable audit trail that documents the signing process.

  • Legal Department: Store executed agreement and review for enforcement rights.
  • Human Resources: Maintain employee acknowledgements and related records.
  • Corporate Records: Archive master executed PDF for corporate governance.
  • Signing Parties: Provide each signer a certified copy and audit certificate.

Technical and integration considerations for e-signing

Choose an e-signing platform that supports required authentication, audit trails, and integrations to align with corporate workflows.

  • Authentication Options: Email, SMS, KBA
  • Integrations: Salesforce, NetSuite, Google Workspace
  • File Formats: PDF, DOCX

Ensure the platform can produce a timestamped audit trail and export records to your document management system; confirm HIPAA or BAA needs when handling protected health information.

Typical timelines and response expectations for NSA workflows

Timelines vary by organization and circumstance. Use clear internal SLAs to move from draft to signed agreement while allowing time for legal review.

Drafting Turnaround:

Allow 2–5 business days for internal drafting and review cycles.

External Review:

Expect counterpart review to take 5–10 business days depending on negotiation scope.

Signature Window:

Set a 7–14 day expiration for signing links to encourage timely execution.

Dispute Response:

Allow 30 days for initial dispute notice and meet-and-confer procedures.

Preservation Start:

Begin retention once agreement is fully executed and archived.

Key milestones from draft to enforceable agreement

Track each milestone to ensure version control and a defensible audit trail through negotiation, execution, and storage.

01

Draft Completion

Finalize language and exhibits before sending to counterparty.

02

Legal Review

Confirm state-specific enforceability and necessary carve-outs.

03

Execution

Collect signatures and capture electronic audit metadata.

04

Recordkeeping

Store master copy and maintain retention logs for compliance.

Common drafting and execution mistakes to avoid

  • Using overly broad language that restrains general competition rather than targeted solicitation, which risks unenforceability.
  • Failing to identify the correct legal entity or affiliates, causing ambiguity about who is bound by the agreement.
  • Neglecting to include exceptions for pre-existing client relationships, resulting in disputes over intent and scope.
  • Omitting a clear execution date or using inconsistent dates between signature blocks, complicating the determination of the effective date.

Legal risks and common enforcement outcomes

Monetary Damages: Compensatory damages for provable losses
Injunctive Relief: Court orders to stop solicitation activity
Attorney Fees: Possible recovery if contract permits
Unenforceability: Overbroad terms can be voided
Reputational Harm: Litigation can damage business relationships
Contractual Forfeiture: Loss of agreed benefits on breach

Sample eSignature vendor pricing and feature comparison

Compare starting prices and core capabilities when selecting an eSignature solution for managing NSAs. Pricing reflects typical per-user annual tiers; feature availability varies by plan.

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 No No Yes, limited Yes, limited
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No

Practical drafting and execution tips for enforceable NSAs

Use these practices to reduce litigation risk and improve clarity while enabling reliable electronic execution and recordkeeping.

Narrow and Specific Scope
Define prohibited solicitation activities by objective criteria, specify protected customers or employees, and avoid blanket restrictions that courts may find unreasonable.
Reasonable Duration
Limit terms to what is necessary to protect legitimate business interests; shorter, justified durations are more likely to be upheld.
State-Specific Review
Have counsel review the agreement for enforceability in each relevant jurisdiction and tailor governing law or venue clauses accordingly.
Clear Execution Records
Capture signer identity, intent, consent, timestamps, and a certified audit trail to support electronic signature validity under ESIGN and UETA.

Real-world examples of NSAs put into practice

These examples illustrate how organizations use NSAs to protect relationships while maintaining operational flexibility.

Martin Properties (Real Estate)

Tim Martin used online execution to finalize non-solicit clauses across multiple property management agreements quickly

  • The platform produced a verified audit trail for each signer
  • This reduced turnaround time and ensured consistent, executed language across a portfolio of leases and management contracts while preserving compliance.

Fertility Centers of Illinois (Healthcare)

John Butler integrated restrictive covenant templates with clinical staff onboarding to protect patient relationships

  • Templates included HIPAA-related confidentiality language
  • This standardized approach reduced negotiation time and ensured executed agreements aligned with privacy and retention obligations.

Frequently asked questions about Legal NSA Agreements

Answers to common practical and legal questions about drafting, signing, and enforcing NSAs, including electronic execution considerations.


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