Non-Compete Agreement - Delaware

DELAWARE EMPLOYEE NON-COMPETE AGREEMENT

TABLE OF CONTENTS

1. Document Header and Role Gate
2. Definitions
3. Consideration
4. Restrictive Covenants
5. Representations
6. Remedies
7. Dispute Resolution
8. General Provisions
9. Execution Block

1. DOCUMENT HEADER AND ROLE GATE

This Delaware Employee Non-Compete Agreement (the “Agreement”) is made as of [EFFECTIVE DATE] by and between [EMPLOYER LEGAL NAME], a [STATE AND ENTITY TYPE] with its principal place of business at [ADDRESS] (“Employer”), and [EMPLOYEE FULL LEGAL NAME], residing at [ADDRESS] (“Employee”).

Employer is engaged in [DESCRIBE BUSINESS]. Employee will serve as [TITLE] and may receive access to the Protected Interests defined below.

1.1 Physician Exclusion

Do not use this employee noncompete against a physician. Under 6 Del. C. § 2707, a covenant in an employment, partnership, or corporate agreement that restricts a physician’s right to practice medicine in a locale or for a period after termination is void. Other agreement provisions may remain enforceable, including a termination-damages provision reasonably related to the injury suffered, but this form does not create such a provision.

2. DEFINITIONS

“Competitive Business” means a business providing [SPECIFIC COMPETING PRODUCTS OR SERVICES] within the Restricted Territory.

“Confidential Information” means non-public Employer information that has business value, excluding general skill and experience, public information, and information Employee may lawfully disclose.

“Protected Interests” means the following legitimate economic interests supported by facts specific to Employee: [IDENTIFY TRADE SECRETS, CONFIDENTIAL INFORMATION, CUSTOMER RELATIONSHIPS, GOODWILL, OR OTHER INTERESTS].

“Restricted Period” means [___] months following termination of employment.

“Restricted Services” means [DESCRIBE ONLY THE SERVICES EMPLOYEE MATERIALLY PERFORMED DURING THE LAST TWELVE MONTHS].

“Restricted Territory” means [IDENTIFY THE AREA IN WHICH EMPLOYEE MATERIALLY WORKED OR DEVELOPED PROTECTED RELATIONSHIPS]. The territory must be fixed or objectively determinable when the Agreement is signed and must not expand automatically with Employer or Affiliate growth.

3. CONSIDERATION

3.1 Specific Consideration. In exchange for Employee’s covenants, Employer will provide [INITIAL EMPLOYMENT / PROMOTION / NEW DUTIES] and [$______ SIGNING OR RETENTION PAYMENT / EQUITY / OTHER SPECIFIC BENEFIT].

3.2 No Blanket Adequacy Statement. The Parties do not rely on a categorical statement that continued employment is adequate consideration. Delaware counsel must evaluate consideration, bargaining circumstances, and timing for this Agreement.

4. RESTRICTIVE COVENANTS

4.1 Non-Competition. During the Restricted Period and within the Restricted Territory, Employee shall not perform Restricted Services for a Competitive Business, but only to the extent reasonably necessary to protect the Protected Interests. This clause does not bar work in a role unrelated to the Restricted Services.

4.2 Customer Non-Solicitation. During the Restricted Period, Employee shall not actively solicit competitive business from a customer with whom Employee had material contact during the last twelve months of employment and whose relationship or information supports a Protected Interest.

4.3 Personnel Non-Solicitation. During the Restricted Period, Employee shall not actively recruit an employee with whom Employee materially worked during the last twelve months for the purpose of causing that person to leave Employer. General advertisements and responses not initiated by Employee are excluded.

4.4 Confidentiality. Employee shall not use or disclose Confidential Information except to perform duties for Employer or as applicable law permits. Upon termination, Employee shall return Employer property in Employee’s possession or control.

4.5 Permitted Activities. Nothing in this Agreement prohibits passive ownership of less than [2]% of a publicly traded company, lawful work outside the Restricted Services and Restricted Territory, or conduct protected by Delaware or federal law.

5. REPRESENTATIONS

5.1 Mutual Authority. Each Party represents that it has authority to enter this Agreement.

5.2 Prior Obligations. Employee represents that entering this Agreement does not breach a disclosed obligation to another person.

5.3 Counsel Opportunity. Employee acknowledges receiving an opportunity to consult independent counsel and to negotiate this Agreement before signing.

6. REMEDIES

6.1 Notice and Cure. For a breach capable of cure, Employer shall provide written notice and [___] days to cure. This provision does not waive either Party’s rights or defenses.

6.2 Injunctive Relief. Employer may seek temporary, preliminary, or permanent injunctive relief upon the proof and security, if any, required by applicable law. This Agreement does not establish irreparable harm or waive defenses.

6.3 Damages and Fees. A Party may seek proven contract damages and attorneys’ fees only when authorized by an enforceable agreement or applicable law. A restrictive covenant must satisfy Delaware’s reasonableness review even when the claimant seeks damages rather than an injunction.

6.4 No Automatic Tolling or Forfeiture. The Restricted Period is not automatically extended, and Employee does not automatically forfeit compensation, because of an alleged breach.

7. DISPUTE RESOLUTION

7.1 Governing Law. This Agreement is governed by Delaware law, without regard to conflicts-of-law principles.

7.2 Forum. Subject to any valid arbitration clause, the Parties submit to the state courts located in [COUNTY], Delaware.

7.3 Optional Arbitration. [IF MUTUALLY SELECTED] Any dispute other than a request for provisional injunctive relief shall be resolved by binding arbitration in [CITY], Delaware under [PROVIDER] employment rules.

7.4 Optional Jury Waiver. [INCLUDE ONLY AFTER COUNSEL REVIEW] THE PARTIES WAIVE THEIR RIGHT TO A TRIAL BY JURY TO THE EXTENT PERMITTED BY LAW.

8. GENERAL PROVISIONS

8.1 Amendment; Waiver. No amendment or waiver is effective unless in a writing signed by both Parties.

8.2 Assignment. Employee may not assign this Agreement. Employer may assign it to a successor that acquires the business and Protected Interests to which the covenants relate.

8.3 Severability and Discretionary Reformation. If a provision is unenforceable, the remaining independent provisions continue only to the extent permitted by law. Delaware courts possess discretion, not a duty, to blue-pencil an overbroad covenant. A reformation clause does not require a court to rescue a facially unreasonable restriction. In deciding whether to reform, a court may consider negotiation, separate valuable consideration, equality of bargaining power, and whether reformation would require drafting a new covenant.

8.4 Entire Agreement. This Agreement and any identified confidentiality or invention-assignment agreement constitute the entire agreement concerning this subject.

8.5 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts and by electronic signature.

8.6 Notices. Notices must be in writing and delivered personally, by certified mail, or by nationally recognized overnight courier to the addresses above.

9. EXECUTION BLOCK

Sources and References

• Delaware Code, 6 Del. C. § 2707: https://delcode.delaware.gov/title6/c027/sc01/index.html
• Delaware Supreme Court, Sunder Energy, LLC v. Jackson (Dec. 10, 2024): https://courts.delaware.gov/Opinions/Download.aspx?id=372810
• Delaware Court of Chancery, Weil Foot & Ankle Institute, LLC v. Dalton (Mar. 14, 2025): https://courts.delaware.gov/Opinions/Download.aspx?id=376230
• Delaware Supreme Court, Fortiline, Inc. v. McCall (Feb. 10, 2026): https://courts.delaware.gov/Opinions/Download.aspx?id=391400