# 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 the business interests the Texas Covenants Not to Compete Act permits a covenant to protect under Tex. Bus. & Com. Code § 15.50(a), including Employer's goodwill, Employer's Confidential Information, and Employer's trade secrets. [[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 Texas Uniform Trade Secrets Act, Tex. Civ. Prac. & Rem. Code § 134A.002(6). ### Recitals, Consideration, and Ancillary Agreement Employer and Employee acknowledge that the restrictive covenants in this agreement are ancillary to and part of an otherwise enforceable agreement between them at the time this agreement is made, as required by Tex. Bus. & Com. Code § 15.50(a). As consideration, Employer agrees to provide, and during employment will provide, Employee with Confidential Information, specialized training, and access to Employer's goodwill and customer relationships; that consideration is reasonably related to Employer's interest in protecting its goodwill and other business interests worthy of protection (Marsh USA Inc. v. Cook, 354 S.W.3d 764 (Tex. 2011)). Because the employment relationship may be at will, the parties intend that these covenants become enforceable when Employer performs that promise by providing the Confidential Information, training, or other consideration described above, and Employee acknowledges that Employer's promise to provide Confidential Information gives rise to Employer's interest in restraining its disclosure or use (Alex Sheshunoff Mgmt. Servs., L.P. v. Johnson, 209 S.W.3d 644 (Tex. 2006); Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844 (Tex. 2009)). The restraints in this agreement contain limitations as to time, geographical area, and scope of activity to be restrained that are reasonable and do not impose a greater restraint than necessary to protect Employer's goodwill or other business interest, as required by Tex. Bus. & Com. Code § 15.50(a). ### Timing and Employee Acknowledgements Employee acknowledges that the restrictions in this agreement are reasonable and necessary to protect Employer's Protected Interests. Employee acknowledges having had the opportunity to consult with independent legal counsel before signing this agreement. 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 Texas law, including the Texas Uniform Trade Secrets Act, Tex. Civ. Prac. & Rem. Code §§ 134A.001–134A.008. This confidentiality obligation does not restrict Employee's use of the general knowledge, skill, and experience Employee acquired during employment, consistent with the Texas Uniform Trade Secrets Act, Tex. Civ. Prac. & Rem. Code § 134A.003, and is not intended to operate as a covenant not to compete. ### 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. ### Non-Solicitation of Customers, Vendors, Referral Sources, and Business Partners During the Restricted Period, Employee must not Solicit the business of any Covered Customer. Texas courts analyze this customer non-solicitation covenant under the Covenants Not to Compete Act's reasonableness test (Tex. Bus. & Com. Code § 15.50(a)); it reaches only Covered Customers with whom Employee had material contact and is no broader than necessary to protect Employer's goodwill. ### 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 is analyzed under the Covenants Not to Compete Act's reasonableness test (Tex. Bus. & Com. Code § 15.50(a)) and reaches only Covered Customers with whom Employee had material contact, no broader than necessary to protect Employer's goodwill. ### 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 contains limitations as to time, geographic area, and scope of activity to be restrained that are reasonable and impose no greater restraint than necessary to protect Employer's goodwill and other Protected Interests, as required by Tex. Bus. & Com. Code § 15.50(a). 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. ### 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. ### Physician and Health Care Practitioner Covenants If Employee is a physician licensed by the Texas Medical Board and this agreement contains a covenant not to compete relating to the practice of medicine, then, as required by Tex. Bus. & Com. Code § 15.50(b): the covenant does not deny Employee access to a list of patients whom Employee has seen or treated within one year before termination; Employee is entitled, on reasonable terms, to access and copies of the medical records of those patients on the patient's authorization; the covenant provides for continuity of care during an acute illness even after the contract or employment terminates; and the covenant provides for a buyout of the covenant by Employee at a reasonable price or, at Employee's election, at a price determined by a mutually agreed arbitrator, in an amount not greater than Employee's total annual salary and wages at the time of termination (§ 15.50(b)(2)). The covenant expires no later than one year after termination, is limited to a radius of no more than five miles from the location where Employee primarily practiced, and is stated clearly and conspicuously in writing (§ 15.50(b)(4)). The practice of medicine does not include managing or directing medical services in a purely administrative capacity (§ 15.50(b-1)), and § 15.50(b) does not apply to Employee's ownership interest in a licensed hospital or licensed ambulatory surgical center (§ 15.50(c)). For an agreement entered into on or after September 1, 2025, the covenant is void and unenforceable if Employee is involuntarily discharged from contract or employment without good cause — meaning a reasonable basis for discharge that is directly related to Employee's conduct, job performance, or contract or employment record (§ 15.50(d)). If Employee is a licensed dentist, a person licensed in professional or vocational nursing, or a licensed physician assistant, then, for an agreement entered into on or after September 1, 2025, any covenant not to compete relating to that practice must provide the same salary-capped buyout, must expire no later than one year after termination, must be limited to a radius of no more than five miles from the location where Employee primarily practiced, and must be stated clearly and conspicuously in writing (§ 15.501). ### 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, including relief under the Texas Uniform Trade Secrets Act, Tex. Civ. Prac. & Rem. Code § 134A.003, to prevent actual or threatened misappropriation of trade secrets. The parties acknowledge that, under Tex. Bus. & Com. Code § 15.51(c), if Employee proves that Employer knew when this agreement was executed that the covenant's limitations were not reasonable and that Employer sought to enforce the covenant to a greater extent than necessary to protect Employer's goodwill or other business interest, the court may award Employee the cost of defense, including reasonable attorney's fees. ### 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 Consistent with Tex. Bus. & Com. Code § 15.51(c), if a court finds that this covenant is ancillary to or part of an otherwise enforceable agreement but contains limitations as to time, geographic area, or scope of activity that are not reasonable and impose a greater restraint than necessary to protect Employer's goodwill or other business interest, the court shall reform the covenant to the extent necessary to make those limitations reasonable and shall enforce the covenant as reformed. The parties acknowledge that, on reformation, the court may not award Employer damages for any breach of the covenant occurring before reformation and may grant only injunctive relief for that period; each restrictive covenant in this agreement is therefore drawn to its final intended scope and does not rely on reformation as a drafting strategy. ### 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 Texas Covenants Not to Compete Act, Tex. Bus. & Com. Code §§ 15.50–15.52. Disputes will be resolved in the courts of the Governing Law state, subject to non-waivable rights under applicable law. For a Texas-based Employee, the parties intend Texas law to govern the enforceability of the restrictive covenants: Texas treats the enforcement of covenants not to compete as a matter of fundamental policy (DeSantis v. Wackenhut Corp., 793 S.W.2d 670 (Tex. 1990)), and a foreign choice-of-law clause will not be applied to escape that policy for a Texas worker. A mandatory forum-selection clause is enforceable in Texas, by mandamus if necessary (In re AutoNation, Inc., 228 S.W.3d 663 (Tex. 2007)). The criteria, procedures, and remedies of the Texas Covenants Not to Compete Act are exclusive and preempt other law, including the common law, under Tex. Bus. & Com. Code § 15.52. ### 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: _______________