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Non-Solicitation Agreement

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NON-SOLICITATION AGREEMENT

This Non-Solicitation Agreement ("Agreement") is made and entered into as of Effective Date: by and between Company Name: , with principal place of business at ("Company"), and Recipient Name: , with principal place of business at ("Recipient").

RECITALS

WHEREAS, Company engages in a business involving valuable relationships with customers, clients and prospective clients and maintains a workforce whose solicitation would cause substantial harm to the Company; and

WHEREAS, Recipient desires to receive certain consideration and/or information from Company and, in connection therewith, will have access to Company employees, contractors, customers, and confidential business information; and

WHEREAS, the parties desire to protect Company’s legitimate business interests by restricting Recipient’s ability to solicit Company’s employees and clients for a limited period as set forth below.

NOW, THEREFORE, in consideration of the mutual covenants and other good and valuable consideration, the sufficiency of which is acknowledged, the parties agree as follows:

1. DEFINITIONS

1.1 "Employee" means any individual who, as of the Effective Date or at any time during the Term, is employed by the Company or is engaged by the Company as a consultant, independent contractor, or temporary worker and who had material contact with Recipient as a result of Recipient’s access to Company information or relationships.

1.2 "Customer" means any person or entity that, within the twelve (12) months preceding the Effective Date or during the Term, (a) purchased products or services from Company, (b) engaged in negotiations with Company regarding the purchase of products or services, or (c) with whom Company had documented business discussions and with whom Recipient had material contact arising out of Recipient’s relationship with Company.

1.3 "Solicit" or "Solicitation" means any direct or indirect action taken to induce, recruit, entice, hire, engage, or attempt to hire or engage an Employee or Customer to terminate or reduce that party’s relationship with Company, or to provide services or products competitive with Company.

2. NON-SOLICITATION OF EMPLOYEES

2.1 During the Term and for a period of months following termination of the Term for any reason, Recipient shall not, directly or indirectly, solicit, induce, recruit, hire, or engage any Employee of Company to terminate or materially alter that Employee’s employment or engagement with Company.

2.2 The restriction in Section 2.1 shall not apply to general solicitations for employment that are not targeted at Company Employees, such as advertisements in newspapers, trade publications, or general internet postings, provided that any such general solicitation does not knowingly target Company Employees.

3. NON-SOLICITATION OF CUSTOMERS

3.1 During the Term and for a period of months following termination of the Term for any reason, Recipient shall not, directly or indirectly, Solicit any Customer of Company for the purpose of providing products or services that are the same as or substantially competitive with those offered by Company.

3.2 Notwithstanding Section 3.1, Recipient may transact with any Customer with whom Recipient had an existing, documented business relationship prior to the Effective Date as described in the list of excluded customers below:

4. TERM AND CONSIDERATION

4.1 Term. This Agreement shall commence on the Effective Date and continue for a period of months (the "Term"), unless earlier terminated in accordance with the terms herein.

5. REMEDIES

5.1 Injunctive Relief. Recipient acknowledges that a breach or threatened breach of this Agreement would cause Company irreparable harm for which monetary damages would be an inadequate remedy. Accordingly, Company shall be entitled, in addition to any other remedies available at law or in equity, to temporary and permanent injunctive relief to prevent or remedy any breach or threatened breach of this Agreement without posting a bond.

5.2 Liquidated Damages. If the parties elect liquidated damages as a remedy, Recipient shall pay Company the sum of as reasonable pre-estimate of loss for each separate and distinct breach, which amount shall be without prejudice to Company’s right to seek injunctive relief or other equitable remedies.

6. CONFIDENTIALITY

6.1 Recipient acknowledges that the obligations hereunder supplement any duty Recipient owes to maintain the confidentiality of Company’s trade secrets and other Confidential Information. Recipient shall not disclose or use Confidential Information except as required to perform Recipient’s duties as specifically authorized in writing by Company.

7. LIMITATIONS; SCOPE

7.1 Reasonableness. The parties agree that the duration, geographic scope, and activities restrained are reasonable and necessary to protect Company’s legitimate business interests. If any court of competent jurisdiction determines any restriction to be unenforceable in its entirety, the invalid restriction shall be reformed to the maximum extent permitted by law and enforced accordingly.

7.2 No Bar to Independent Rights. Nothing in this Agreement shall prevent Recipient from independently developing general skills, knowledge, and experience, nor shall it prevent Recipient from providing services to customers who are not Customers as defined herein or who were not targeted in breach of this Agreement.

8. NOTICES

All notices, demands, or communications required or permitted under this Agreement shall be in writing and shall be delivered personally, by certified mail (return receipt requested), or by nationally recognized overnight courier to the addresses set forth below or to such other address as either party may designate by notice in accordance with this Section.

9. MISCELLANEOUS

9.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to conflict of laws principles.

9.2 Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, whether written or oral, relating to such subject matter.

9.3 Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable by a court of competent jurisdiction, such provision shall be reformed or, if necessary, severed to the minimum extent necessary to make the remaining provisions enforceable, and the remainder of this Agreement shall remain in full force and effect.

9.4 Amendments; Waiver. No amendment or waiver of any provision of this Agreement shall be effective unless in writing and signed by an authorized representative of each party. No failure or delay by any party in exercising any right under this Agreement shall operate as a waiver of that right.

9.5 Counterparts. This Agreement may be executed in counterparts, each of which 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.

ACKNOWLEDGMENT

Each party acknowledges that it has had a full opportunity to review and negotiate the terms of this Agreement, has had the opportunity to seek independent legal counsel, and understands and accepts the obligations imposed by this Agreement.

Company Printed Name:

By:

Date:

Recipient Printed Name:

By:

Date:

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What a Non-Solicitation Agreement Is

A Non-Solicitation Agreement defines restrictions that prevent a departing employee, contractor, or third party from soliciting a company's employees, customers, or vendors for a specified period or within a geographic area. It protects client relationships, preserves workforce stability, and limits competitive outreach while setting expectations about prohibited conduct and available remedies. Typical provisions identify covered parties, prohibited actions, permitted exceptions, duration, geographic scope, and remedies. Enforceability depends on reasonableness under the governing state law and statutory limits.

Why Organizations Use Non-Solicitation Agreements

Non-Solicitation Agreements protect customer lists and employee relationships, provide a contractual basis for injunctive relief or damages, and clarify post-termination expectations so parties know permitted conduct and consequences.

Why Organizations Use Non-Solicitation Agreements

Who Commonly Uses This Agreement

Common users include employers, legal counsel, HR teams, and contracting businesses seeking to limit post-termination solicitation.

  • Employers protecting client lists and sales relationships from departing representatives.
  • Service providers or consultants who share sensitive contacts or referral channels.
  • Investors or acquirers preserving value during transition or post-closing periods.

Use varies by industry, contract type, and state law; legal review ensures scope and duration are reasonable and enforceable.

Core Elements to Include for Clarity and Enforceability

A professional Non-Solicitation Agreement defines parties, restricted activities, geographic and market scope, duration, exceptions, remedies, and dispute resolution to support enforceability and clarity.

Parties

Identify employer and employee or contractor by full legal name and capacity; include third parties such as contractors or agents. Accurate naming prevents ambiguity and supports enforceability in dispute resolution.

Restricted Conduct

Specify actions that constitute solicitation (direct contact, referrals, targeted outreach) and whether passive contact or general advertising is excluded. Clear definitions narrow disputes and aid judicial review.

Geographic Scope

Define the geographic area covered with measurable boundaries (states, counties, market territories). Tie scope to legitimate business interests to reduce risk of judicial narrowing or invalidation.

Duration

Set a time limit tied to protectable interests, commonly 6–24 months. Courts assess reasonableness by industry and role; overly long durations increase risk of unenforceability.

Carve-Outs

List permitted activities such as general advertising, pre-existing customer relationships, or passive inquiries. Carve-outs reduce overbreadth and improve enforceability while protecting core client relationships.

Remedies

Describe remedies for breach including injunctive relief, liquidated damages, and attorneys' fees; specify dispute resolution method and governing law to streamline enforcement.

Essential Information to Record in the Agreement

Employee Name: Full legal name as on government-issued ID
Employer Name: Legal entity name, include DBAs if used
Effective Date: Enter date as MM/DD/YYYY
Role / Title: Employee or contractor role description
Restricted Parties: Customers, employees, vendors specified clearly
Signatures: All parties sign and date the agreement

Step-by-Step: Completing a Non-Solicitation Agreement

Follow these steps to prepare, negotiate, sign, and preserve a Non-Solicitation Agreement accurately, whether executed electronically or on paper.

  • 01
    Prepare Parties: Enter full legal names and addresses for all parties.
  • 02
    Define Scope: Specify prohibited solicitation actions and any carve-outs.
  • 03
    Set Duration: Choose a reasonable time tied to business interest.
  • 04
    Sign & Store: Obtain signatures, date, and retain original or e-signed copy.

How to Configure an Online Execution Workflow

Set up a repeatable online workflow for Non-Solicitation Agreements including templates, signer roles, authentication, and retention settings for consistent execution.

Online Workflow Setting and Field Configuration steps and recommended values
Template Identifier and Versioning Info Name template, lock clauses, track versions.
Signer Order and Roles Definition Set primary signer, countersigners, and guest access.
Authentication Method and Strength Use email link, SMS code, or KBA if needed.
Conditional Fields and Carve-Outs Use conditional fields to reveal carve-outs only when relevant.
Retention and Audit Trail Settings Enable audit trail, set document retention period and export.

Where to Send and Store the Executed Agreement

After execution, route the signed Non-Solicitation Agreement to internal and external recipients, store an auditable copy, and schedule any notarization or RON required by policy or law.

  • To Employee: Provide executed copy to the employee or contractor via email.
  • To HR Files: Store signed original in the employee’s personnel file per retention policy.
  • To Legal Counsel: Send final executed agreement to legal for review and enforcement planning.
  • To Client / Vendor: Deliver executed copy to affected customers or vendors when required.

Digital Signing and Platform Considerations

Use eSignature platforms that support detailed audit trails, signer authentication, secure storage, and compliance controls to preserve evidentiary value.

  • Accepted Formats: PDF, DOCX, HTML supported
  • Integrations: Salesforce, NetSuite, Microsoft 365 integrations
  • Security: TLS 1.2/1.3 and AES-256 encryption

Key Timelines to Track

Track effective dates, negotiation windows, notarization timing, and retention start dates to protect enforcement rights and meet statutory obligations.

Effective Date and Commencement:

Enter as MM/DD/YYYY; governs when restrictions begin.

Negotiation & Signing Window:

Allow adequate time for review and counsel, typically 1–4 weeks.

Local Statute of Limitations Impact:

Limitations affect enforcement timing — consult state law.

Retention Start Date:

Retention begins on execution date or last effective amendment.

Notary or RON Scheduling:

Plan notarization or RON in advance; require identity proofing.

Common Preparation Pitfalls to Avoid

  • Overly broad geographic or temporal restrictions invite judicial narrowing or invalidation; tie scope to demonstrable business interests and empirical data where possible.
  • Vague definitions of 'solicit' or 'customer' lead to disputes; define prohibited acts and included customer lists with measurable markers.
  • Failing to record executed originals or audit trails complicates enforcement; keep dated, signed copies and maintain metadata for evidence.
  • Applying the same terms to contractors and employees without role distinctions can be inappropriate; adapt clauses to job functions and access to contacts.

Consequences of a Deficient Agreement

Enforceability Risk: Court may void overbroad clauses
Injunction Delay: Remedies may be slow and costly
Damages Uncertain: Monetary recovery can be limited
Attorney Fees: Potential expense for litigation or defense
Regulatory Exposure: State law limitations and wage law conflicts
Operational Disruption: Loss of customers or team instability

Real-World Examples of Agreement Use

Two short examples show how organizations implement Non-Solicitation Agreements in practice across different sectors.

Optica Ventures (COO)

Optica implemented standard protective covenants across its contracting workforce to safeguard client introductions and referrals.

  • Implementation focused on tailored carve-outs for preexisting clients to reduce disputes.
  • As a result, the company preserved key client relationships during turnover while keeping clauses reasonably narrow to improve enforceability and reduce litigation risk.

Martin Properties (Founder)

A real estate firm added client-solicit limits for departing agents tied to local territories.

  • The firm limited duration to 12 months to reflect market cycles.
  • This approach balanced protection of brokerage listings with agents' mobility, reducing conflicts and making enforcement more likely while preserving recruiting flexibility.

Who Has Authority to Sign

Company Executive

Authorized signers include C-level executives, company presidents, or officers with delegated authority; ensure signatory has express corporate authority to bind the entity and consider a board resolution for high-risk agreements.

Employee / Contractor

The individual covered by the covenant must sign personally; for contractors, include signature and business entity acknowledgment to show mutual assent and enforceability.

Practical Tips for Drafting and Execution

Adopt clear drafting practices to improve enforceability and reduce disputes when using Non-Solicitation Agreements.

Tailor Scope to Role
Limit restrictions to what the individual reasonably had access to or could exploit; role-based restrictions are more defensible than blanket prohibitions.
Use Clear Definitions
Define key terms such as 'solicit', 'customer', and 'confidential information' precisely to reduce ambiguity during enforcement.
Include Reasonable Carve-Outs
Permit pre-existing relationships and general advertising to avoid overbreadth and improve the likelihood a court will uphold the agreement.
Document Consideration
Record consideration (promotion, bonus, access to confidential information) to support enforceability, especially for post-employment promises.

eSignature Pricing and Feature Comparison

Baseline pricing and key capability differences across common eSignature vendors useful when executing Non-Solicitation Agreements; signNow appears first for comparison.

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 free trial Varies by vendor Varies by vendor Varies by vendor Varies by vendor
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 No cap reported No cap reported No cap reported

Frequently Asked Questions

Common questions about enforceability, e-signing, notarization, and practical issues when using Non-Solicitation Agreements.


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