# Employee Restrictive Covenant Agreement

## Cover Terms

The terms below are incorporated into and form part of this agreement.

Employer
: {employer_name}

Employee
: {employee_name}

Employee Title / Position
: {employee_title}

Effective Date
: {effective_date}

Governing Law
: {governing_law}

Confidentiality

Trade Secrets Duration
: {confidentiality_trade_secret_duration}

Other Confidential Information Duration
: {confidentiality_other_duration}

Employee Non-Solicitation

Duration
: {employee_nonsolicit_duration}

Customer Non-Solicitation

Duration
: {customer_nonsolicit_duration}

Non-Competition

Duration
: {noncompete_duration}

Restricted Territory
: {territory}

Competitive Business
: {competitive_business_definition}

Specified Competitors
: {specified_competitors}

No Business with Covered Customers

Duration
: {nondealing_duration}

Non-Investment

Duration
: {noninvestment_duration}

Non-Disparagement

Duration
: {nondisparagement_duration}

## Standard Terms

### Defined Terms

[[Competitive Business]] means the business activities described in Cover Terms under Competitive Business.

[[Confidential Information]] means non-public information relating to Employer's business, including trade secrets, customer lists, pricing, business processes, technical data, and strategic plans, but excluding information that becomes public through no fault of Employee.

[[Covered Customers]] means customers, vendors, referral sources, and business partners with whom Employee had material contact or for whom Employee had responsibility during the {covered_customer_period} before termination of employment.

[[Covered Employees]] means employees with whom Employee worked or whom Employee managed during the {covered_employee_period} before termination of employment.

[[Passive Public Holdings]] means ownership of securities of a publicly traded company representing less than {passive_public_holdings_threshold} of any class of such company's securities, and interests in diversified mutual funds, index funds, and exchange-traded funds that may hold securities of a Competitive Business.

[[Protected Interests]] means Employer's legitimate business interests, judged on the totality of the facts and circumstances under 820 ILCS 90/7 and 90/15, in its Confidential Information and trade secrets, its near-permanent relationships with customers, patients, and referral sources, its workforce stability, and its goodwill.

[[Restricted Period]] means the duration specified in Cover Terms for each covenant, beginning on the date Employee's employment with Employer ends for any reason.

[[Restricted Territory]] means the geographic area described in Cover Terms under Restricted Territory.

[[Solicit]] means to directly or indirectly contact, approach, induce, encourage, or provide Confidential Information to any person or entity for the purpose of diverting business away from Employer, but does not include responding to general advertisements or unsolicited inquiries not initiated by Employee.

[[Trade Secrets]] has the meaning given in the Illinois Trade Secrets Act, 765 ILCS 1065/2(d).

### Recitals and Legitimate Business Interests

Employer and Employee acknowledge that each restrictive covenant in this agreement is ancillary to a valid employment relationship and is supported by, and no greater than required to protect, one or more legitimate business interests of Employer, as required by 820 ILCS 90/15. Consistent with 820 ILCS 90/7 and Reliable Fire Equipment Co. v. Arredondo, 2011 IL 111871, whether a legitimate business interest exists is determined by the totality of the facts and circumstances, including Employee's exposure to Employer's customer, patient, and referral relationships and their near-permanence, Employee's acquisition of Confidential Information and trade secrets through employment, and the time, place, and scope of the restraint, with no single factor being decisive. Employer would not provide Employee with access to these Protected Interests absent the protections in this agreement, and each covenant is intended to impose no undue hardship on Employee and to cause no injury to the public.

### Timing, Consideration, and Right to Consult Counsel

Employer has advised Employee, in writing, to consult with an attorney before entering into this agreement, and has either provided Employee with a copy of this agreement at least 14 calendar days before the commencement of Employee's employment or given Employee at least 14 calendar days to review it before signing, as required by the Illinois Freedom to Work Act, 820 ILCS 90/20. Employee may choose to sign before the 14-day period expires, but Employer has extended the full period. The parties agree that this agreement is supported by adequate consideration within the meaning of 820 ILCS 90/5 — either at least two years of employment after Employee signs this agreement, or {illinois_consideration} — and, consistent with Midwest Lending Corp. v. Horton, 2023 IL App (3d) 220132, that any professional or financial benefit relied on as consideration is given specifically in exchange for the restrictive covenants in this agreement. Employee acknowledges that the restrictions in this agreement are reasonable and necessary to protect Employer's Protected Interests. This agreement is effective as of the Effective Date listed in Cover Terms.

### Confidential Information and Trade Secret Protection

Employee must treat all Confidential Information as strictly confidential. Employee must not use or disclose Confidential Information except as required to perform authorized job duties or with Employer's prior written consent. Employee's obligations regarding trade secrets continue in perpetuity. Employee's obligations regarding other Confidential Information continue for the period specified in Cover Terms. Trade secrets are protected under Illinois law, including the Illinois Trade Secrets Act, 765 ILCS 1065/1 et seq.

### Permitted Disclosures and Protected Conduct

Nothing in this agreement prohibits Employee from: (a) reporting possible violations of law to any government agency, including the Securities and Exchange Commission, the Equal Employment Opportunity Commission, the Occupational Safety and Health Administration, or any other federal, state, or local agency; (b) making disclosures protected under whistleblower provisions of any law; (c) discussing wages, hours, or other terms and conditions of employment as protected by applicable law; (d) testifying truthfully in legal proceedings; or (e) filing a sealed complaint in court using Confidential Information without liability. Pursuant to the Defend Trade Secrets Act (18 U.S.C. § 1833(b)), Employee may not be held criminally or civilly liable for disclosing a trade secret in confidence to a government official or attorney solely for the purpose of reporting or investigating a suspected violation of law, or in a sealed court filing.

### Return, Deletion, and Certification of Company Property

Upon termination of employment, Employee must promptly return to Employer all documents, devices, files, credentials, and other materials containing or relating to Confidential Information. Where permitted, Employee must permanently delete electronic copies of Confidential Information from personal devices and accounts. Employee must certify compliance with this section in writing upon Employer's request.

### Non-Solicitation of Employees

During the Restricted Period, Employee must not Solicit, recruit, hire, or attempt to hire any Covered Employee. This restriction does not prohibit Employee from providing a professional reference upon request or from hiring a person who responds to a general advertisement not directed specifically at Employer's employees. This covenant applies only if Employee's actual or expected annualized rate of earnings exceeds $45,000, as required by 820 ILCS 90/10(b).

### Non-Solicitation of Customers, Vendors, Referral Sources, and Business Partners

During the Restricted Period, Employee must not Solicit the business of any Covered Customer. This covenant applies only if Employee's actual or expected annualized rate of earnings exceeds $45,000, as required by 820 ILCS 90/10(b), and it protects Employer's legitimate business interest in its substantial, near-permanent relationships with specific customers, patients, referral sources, and business partners under 820 ILCS 90/7.

### No Business with Covered Customers

During the Restricted Period, Employee must not accept, service, or do business with any Covered Customer, regardless of whether Employee or the Covered Customer first initiated contact. This restriction is broader than non-solicitation because it applies even if the Covered Customer approaches Employee. This covenant applies only if Employee's actual or expected annualized rate of earnings exceeds $45,000, as required by 820 ILCS 90/10(b), and it protects Employer's legitimate business interest in its substantial, near-permanent customer, patient, and referral relationships under 820 ILCS 90/7.

### Non-Competition

During the Restricted Period, Employee must not engage in, be employed by, consult for, or have an active ownership interest in any Competitive Business within the Restricted Territory. This covenant applies only if Employee's actual or expected annualized rate of earnings exceeds $75,000, as required by 820 ILCS 90/10(a), and it is no broader in time, place, or scope than required to protect Employer's legitimate business interests under 820 ILCS 90/15. Passive Public Holdings are permitted.

### Non-Investment

During the Restricted Period, Employee must not acquire or hold any active ownership interest in, serve as a director, officer, manager, or advisor to, or have material economic participation in any Competitive Business. This restriction primarily targets active or material ownership in private competitors. Passive Public Holdings are permitted. Because this covenant restrains active roles at and material participation in a Competitive Business, it functions as a covenant not to compete under the Illinois Freedom to Work Act; it therefore applies only if Employee's actual or expected annualized rate of earnings exceeds $75,000 (820 ILCS 90/10(a)), is subject to the same protected-worker exclusions and layoff-compensation condition as the non-compete in this agreement, and is drawn no broader than necessary to protect Employer's legitimate business interests under 820 ILCS 90/15.

### Non-Disparagement

During the Restricted Period specified in Cover Terms for Non-Disparagement, Employee must not make statements that are intended to or reasonably likely to disparage Employer, its officers, directors, employees, products, or services. This section does not restrict Employee from making truthful statements in legal proceedings, providing truthful testimony, making disclosures to government agencies, or exercising rights protected by law.

### Workers Exempt from the Illinois Covenant Restrictions

Notwithstanding any other provision of this agreement, the covenant not to compete and the covenant not to solicit do not apply to, and are void and unenforceable against, Employee to the extent Illinois law so provides, including: an Employee working in construction, as to both covenant types (820 ILCS 90/10(e)), unless Employee primarily performs management, engineering or architectural, design, or sales functions or is an owner; an Employee covered by a collective bargaining agreement under the Illinois Public Labor Relations Act or the Illinois Educational Labor Relations Act, as to the covenant not to compete (820 ILCS 90/10(d)); a nurse or certified nurse aide placed by a nurse agency on a temporary basis (225 ILCS 510/14(g)); an Employee in the broadcasting industry, as to post-employment geographic and time restraints (820 ILCS 17/10); and, for a covenant entered into on or after January 1, 2025, a licensed mental-health professional providing services to veterans or first responders where enforcement would likely increase the cost or difficulty of obtaining those services (820 ILCS 90/10(f)). These exclusions apply regardless of Employee's earnings, the consideration provided, the notice given, or the reasonableness of the restraint.

If Employee is terminated, furloughed, or laid off as the result of business circumstances or governmental orders related to the COVID-19 pandemic or under circumstances similar to it, the covenant not to compete and the covenant not to solicit are enforceable only if Employer pays Employee, for the period of enforcement, compensation equivalent to Employee's base salary at the time of termination, reduced by any compensation Employee earns through subsequent employment during that period (820 ILCS 90/10(c)).

### No Conflicting Obligations

Employee represents that performing duties for Employer and complying with this agreement does not conflict with any prior agreement, court order, or legal obligation binding on Employee. Employee must promptly disclose to Employer any potential conflict that arises during employment.

### Notice to Future Employers and Other Third Parties

Employer may disclose the existence and terms of this agreement to any prospective employer or business associate of Employee if Employer has a reasonable belief that Employee may breach this agreement. Employee consents to this disclosure.

### Tolling During Breach

If Employee breaches any restrictive covenant in this agreement, the Restricted Period for that covenant is extended by one day for each day of the breach, so that the full duration of the restriction runs from the date the breach ends.

### Remedies

Employee acknowledges that a breach of this agreement may cause Employer irreparable harm for which money damages would be inadequate. Employer may seek injunctive or other equitable relief in addition to any other remedies available at law. Under 820 ILCS 90/25, if Employer files a civil action or arbitration, including by counterclaim, to enforce a covenant not to compete or a covenant not to solicit and Employee prevails, Employee recovers all costs and all reasonable attorney's fees from Employer. Employer's imposition or enforcement of restrictive covenants against workers who are exempt or below the applicable earnings threshold may also expose Employer to investigation and civil penalties by the Illinois Attorney General under 820 ILCS 90/30.

### Enforceability and Severability

If any provision of this agreement is found to be unenforceable, the remaining provisions remain in full force and effect. Each restrictive covenant in this agreement is intended to be independently enforceable.

### Reformation

The parties acknowledge that, under 820 ILCS 90/35, a court may, but is not required to, reform or sever an overbroad covenant rather than declare it void, and that one factor the court weighs is whether the agreement authorized such modification; Employer therefore requests reformation if any restraint in this agreement is found to be overbroad. Because 820 ILCS 90/35 warns that extensive judicial reformation may be against the public policy of Illinois and because Illinois courts decline to rewrite patently overbroad covenants (AssuredPartners, Inc. v. Schmitt, 2015 IL App (1st) 141863), each restrictive covenant in this agreement is drawn no broader than necessary and is intended to be enforceable as written rather than in reliance on judicial revision.

### Survival and Expiration of Each Covenant

Each restrictive covenant in this agreement survives the termination of Employee's employment for the Restricted Period specified in Cover Terms. Obligations under the Confidential Information and Trade Secret Protection section survive indefinitely to the extent they relate to trade secrets. All other provisions survive to the extent necessary to enforce rights that arose during employment.

### Assignment and Successors

Employee may not assign this agreement or any rights or obligations under it. Employer may assign this agreement to any affiliate, successor, or acquirer of all or substantially all of Employer's business or assets. This agreement is binding on and inures to the benefit of the parties and their respective heirs, successors, and permitted assigns.

### Governing Law, Venue, and Dispute Process

This agreement is governed by the law listed in Cover Terms, including the Illinois Freedom to Work Act, 820 ILCS 90, for covenants entered into on or after January 1, 2022. Disputes will be resolved in the courts of the Governing Law state, subject to non-waivable rights under applicable law.

### Entire Agreement, Amendment, Waiver, and Electronic Signatures

This agreement constitutes the entire agreement between the parties regarding its subject matter and supersedes all prior agreements, understandings, and negotiations on this subject. This agreement may be amended only in writing signed by both parties. A party's failure to enforce any provision does not waive that party's right to enforce it later. This agreement may be executed in counterparts, including by electronic signature, each of which is an original.

## Signatures

By signing this agreement, each party acknowledges and agrees to the restrictive covenant obligations above. Employee confirms having read and understood each provision, including the Cover Terms.

Employer: {employer_name}

Signature: _______________
Signatory Name: {employer_signatory_name}
Title: {employer_signatory_title}
Date: _______________

**Employee**

Signature: _______________
Print Name: {employee_name}
Date: _______________