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Arkansas Non-Compete Agreement Template

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The Arkansas Non-Compete Agreement Template is a legally enforceable document often used by companies disclosing sensitive information its members. The purpose of this document is to gain a promise that any recipient (employee, contractor, etc.) of this information refrain in using it to compete or help a third party compete with the disclosing company. For example, once an employee is no longer with the disclosing company, that company must insist the former employee agrees not to share any company information, secrets, sales lists etc. Additionally, a company using this form will expect the former employee to cease doing any business with clients acquired or with any of the company’s competitors.

In the state of Arkansas, breaching this type of agreement could result in the former employee being held financially responsible to the company as well as any additional citations, should the covenant ever be breached the presented by the disclosing company to a judge in a court of law.

Restrictions

Effective July 22, 2015, Non-compete agreements are not enforceable in the medical field of an employee holding a professional license.

Noncompete agreements are enforced if the agreement is ancillary to an employment relationship or part of an otherwise enforceable employment agreement or contract to the extent that both:

  1. The employer has a protectable business interest.
  2. The noncompete is limited regarding time and scope in a manner that is not greater than necessary to defend the employer’s protectable business interest.

Laws – § 4-75-101

How to Write

1 – The Disclosing Party’s Statement

This section shall establish the parties (employer and an employee) in which the contents will be agreed upon, one to the other prior to employment.

Locate the first line of the 1st section then, enter the name of the business or company for which the employee must continue to protect all company information, even after termination or resignation, until the time, as stated in the document has passed.

Next, use the second line of section 1 to enter the name of the recipient or employee who agrees to protect the company information for the lifespan of this contract

2 – The Exact Limits Imposed On The Recipient

In the second section of the document, titled “Non- Compete/Disclosure,” the Disclosing Company should read through then check any boxes corresponding to a restriction statement that should exist as a part of this contract.

The “Business Practices” of a Recipient Employee will be restricted to the wording of the first statement when the corresponding checkbox is checked.

Any and all “Clients/Customers” will be considered forbidden territory for the Recipient of this contract, if the second checkbox is checked.

Put a check mark in the third check box to restrict the Recipient Employee’s interactions with the Disclosing Company’s “General Competitors.”

Any “Specific Competitor(s)” the Disclosing Company does not wish the Recipient Employee to contact or associate with in any way should be listed in the fourth statement (several blank lines have been provided). The fourth checkbox must be checked for this statement to apply.

Place a checkmark in the fifth check box if the Disclosing Company has determined the Recipient Employee must be restricted from associating or dealing with any of its staff members, or contractors employed (past or present) with the Disclosing Company.

3 – When This Paperwork Starts Being Effective And How Long It Will Remain Effective

The employee must enter a specific time period (years, months) in which the Recipient Employee must guarantee to abstain from conducting any business with information collected and/or used during their time of employment with the company as stated in this paperwork. This should be recorded on the blank line in the first statement under the heading “3. Time Period.” One of the next two checkbox statements must be checked to indicate when this Period of Effect begins.

If these terms become active as of the “Effective Date Of This Agreement” then, check the first box. If this agreement only goes into effect upon the “Termination Of The Recipient’s Employment and/or Business With The Company” then mark the second checkbox.

4 – The Disclosing Party’s Considerations

In some cases, companies will offer the recipient the option of a “Purchase Option.” This will allow the Recipient Employee the option of buying their way out of the non-compete. If the Disclosing Company wishes to offer this option. The acceptable Purchase Amount (in USD) must be recorded on the two blank spaces in the statement beginning with the words “The Company Shall Allow The Recipient…” The checkbox just before this statement must be marked after the Purchase Amount is supplied.

If this option will not be available, then check the box preceding the statement “The Company Does Not Allow The Recipient…”

5 – The County/City and State Where This Paperwork Will Be Applicable

In the event the company wishes to state specific jurisdictions, these jurisdictions must be listed in the blank space provided in the statement under the bold words  “5. Jurisdiction.”

6 – The Agreement Is Set In Motion And Will Be Considered A Binding Promise

After the employee agrees to all aspects, written and read; both parties must acknowledge they have reviewed the information it contains. This can only be done through signature.

 

First, this paperwork’s Effective Date should be recorded in the statement starting with the words “In Witness Whereof”

The Company column will provide an area, so the Disclosing Company may approve this agreement through the signature of its Authorized Representative. This representative must print his or her Name below this signature then document the Date of Signature.

The Recipient column is reserved so the Recipient Employee may provide his or her Signature, Printed Name, and Signature Date. Once the Recipient and Company have signed this agreement it will be considered a contract between the two parties.


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