Non-Compete Agreement

A Non-Compete Agreement is an agreement under which a party agrees not to enter into a similar trade or business in competition against another or work for a person or organization that is in direct competition with the other party.

The use of this agreement is premised on the possibility that upon their termination or resignation, a person (such as an employee, a service provider or any other person engaged to provide services) might begin to work for a competitor or start a business. The person will gain competitive advantage by exploiting confidential information, trade secrets or sensitive information, such as customer/client's lists, business practices, upcoming products, new invention, market plans, etc.

This document details the particulars of the parties to the agreement, the non-compete provision, the period of the non-compete, non-solicitation provision, etc.

In this template, it's also possible to include a non-solicitation clause to the agreement. The non-solicitation provision states that one of the parties will be prohibited from seeking business or employment from the clients/customers of the other party. It also restricts the party from employing another party's employees, contractors or agents.

Uses of a Non-Compete Agreement

This document is usually used in the following situation:

• In an employment relationship: This could either be used where an employment relationship exists between an employer and an employee in a contract of service or a contractual relationship between a client and a service provider in a contract for service. The employer is the person or organization that engages the services of an employee. In this case, the employer controls the manner the employee does the work and is also liable for acts or commission committed by the employee (who is acted under the authority of the employer) in the course of employment. While the independent contractor is a person or organization that works independently and is not subject to the control of the contracting party (the client). In this case, the employer/client may use the agreement to prevent the employee/service provider from competing with the employer/client.

• In a relationship between an inventor and evaluator: This agreement could be used where an inventor intends to restrict an evaluator from competing with it. An inventor here, is a person who devices a new invention, technology or innovation (for example, an invention of a mobile application), while an evaluator is a person who is engaged by the inventor to analyze and access the invention. In this type of relationship, the evaluator will have access to confidential information and trade secrets of the inventor. The inventor may also require a Non-Disclosure Agreement to protect its confidential information and trade secrets.

How to use this document

This document can be used by a party who has engaged the services of another, or who has established a contractual relationship with another and has disclosed certain confidential information or trade secrets which he would not want the other party to exploit to operate or work in a similar business or trade. Hence, it can be used by an employer, client, inventor and any other party who will be sharing confidential information relating to their trade or business.

If this document is to be used where an employment relationship exists, after filling the form, the employer/client must sign the document and the document must be attested to by one witness who will enter his/her particulars (such as name, address, occupation) and sign the document. After this is done, the employee/service provider must also sign and have a witness attest to the document by filling their particulars (such as name, address, occupation) and sign the document. After signing the document, the parties must keep at least one copy of the executed document each for record purposes.

If this document is used to protect an invention, after filling the form, the inventor(s) must sign the document and the document must be attested to by one witness who will enter his/her particulars (such as name, address, occupation) and sign the document. After this is done, the evaluator(s) must also sign and have a witness attest to the document by filling their particulars (such as name, address, occupation) and sign the document. After signing the document, the parties must keep at least one copy of the executed document each for record purposes.

Applicable Law

The general rules of contract are applicable to this document

How to modify the template

You fill out a form. The document is created before your eyes as you respond to the questions.

At the end, you receive it in Word and PDF formats. You can modify it and reuse it.