Sample Noncompetition Agreement between two Businesses
What this document covers
This Sample Noncompetition Agreement between two Businesses is a legal document designed to prevent one business (the Seller) from competing with another (the Company) for a specified period of time, following a business acquisition. This agreement protects the Companyâs interests by restricting the Sellerâs ability to engage in similar business activities and by ensuring the confidentiality of proprietary information. Unlike other general agreements, this form provides specific clauses tailored for businesses involved in an asset purchase agreement, thereby addressing unique competitive dynamics in various industries.
Main sections of this form
- Confidentiality clause to protect proprietary information from being disclosed.
- Non-competition clause prohibiting the Seller from engaging in similar businesses for three years.
- Non-solicitation clause that limits the Seller's ability to attract employees and customers for set periods.
- Remedies for breach, affirming the Company's right to seek legal action beyond just monetary damages.
- Governing law specification, indicating that the laws of New Hampshire will apply.
When to use this form
This form should be used when one business is acquiring assets from another and wishes to ensure that the Seller does not compete for a specified time in the same market area. It is particularly relevant in industries where proprietary information is a significant competitive advantage, and where protecting customer relationships and employee stability is critical post-acquisition.
Who this form is for
- Businesses involved in mergers and acquisitions wishing to keep their competitive edge.
- Corporations entering into asset purchase agreements to protect confidential information.
- Sellers who want to clarify their obligations regarding competition after selling their business assets.
Completing this form step by step
- Identify the parties involved: the Seller and the Company.
- Specify the date and relevant agreement details in the provided fields.
- Review and agree on confidentiality and non-competition terms.
- Ensure all parties sign the agreement in the designated areas.
- Distribute copies of the signed agreement to all parties for their records.
Does this form need to be notarized?
Notarization is not commonly needed for this form. However, certain documents or local rules may make it necessary. Our notarization service, powered by Notarize, allows you to finalize it securely online anytime, day or night.
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Make edits, fill in missing information, and update formatting in US Legal Forms—just like you would in MS Word.
Download a copy, print it, send it by email, or mail it via USPS—whatever works best for your next step.
Sign and collect signatures with our SignNow integration. Send to multiple recipients, set reminders, and more. Go Premium to unlock E-Sign.
If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
We protect your documents and personal data by following strict security and privacy standards.
Typical mistakes to avoid
- Failing to specify the geographic scope of the non-competition clause.
- Not aligning the duration of the agreement with industry standards.
- Overlooking the need for both parties to sign the document.
- Neglecting to detail the consequences of a breach clearly.
Why use this form online
- Immediate access to a professionally drafted document saves time.
- Editable fields to allow for customization based on specific business needs.
- Secure download ensuring confidentiality of sensitive business details.
- Easy storage and retrieval without the need for physical paperwork.
Legal use & context
- Noncompetition agreements are enforceable only if they are reasonable in scope, duration, and geographic reach.
- Courts may modify overly broad clauses to ensure fairness and legality.
- This form should be considered within the context of industry norms and legal guidelines in New Hampshire.
Summary of main points
- A Sample Noncompetition Agreement protects business interests during and after an asset transfer.
- Clear definitions and terms are essential for enforcement.
- Customizing the form to reflect specific business scenarios is crucial for its effectiveness.
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FAQ
In contrast, in many industries, a Non-Compete with a duration of 6-months will be considered reasonable, and therefore enforceable. The general rule is that the duration of the agreement should not exceed the time reasonably necessary to protect the employer's legitimate business interests.
On average, non-compete cases cost $10,000 or less. Many times an employer is seeking an injunction, which if the employer loses may result in a quicker resolution. Many times the issues are less factual and more legal. Legal issues require less discovery, which can be the most costly part of litigation.
In contrast, in many industries, a Non-Compete with a duration of 6-months will be considered reasonable, and therefore enforceable. The general rule is that the duration of the agreement should not exceed the time reasonably necessary to protect the employer's legitimate business interests.
What is a noncompete agreement? Keep the group small. Keep the restrictions reasonable and narrow. Provide consideration for the agreement. Get it in writing. Prepare multiple versions if necessary. Concede choice of law/forum. Provisions to include.
A traditional non-compete stops an employee from working for a competitor in a certain geographical area for a certain amount of time after leaving the company. A non-solicitation agreement prevents an employee from poaching customers, contracts or other employees from the company that first hired them.
Study your competition. Write up the agreement. Have your agreement reviewed by a legal professional. Present the non-compete contract to your employee. If everyone is satisfied, sign and date the agreement.
Typically, the only way to fight a non-compete agreement is to go to court. If you are an employee (or former employee) who signed such an agreement, this means you must violate the agreement and wait to be sued. It may be that your former employer has never sued another employee to enforce the non-compete agreement.
A noncompete agreement is a contract between an employee and an employer in which the employee agrees not to enter into competition with the employer during or after employment. These legal contracts prevent employees from entering into markets or professions considered to be in direct competition with the employer.
