How to Negotiate a Non Compete Clause

[kennethbroyles]

I am going over a non compete agreement in a contract for my services with a IMG to be the speaker/ presenter for seminars. (1099)

The "boilerplate" agreement/ contract is to restrictive in its language and they understand that 2 yrs that limits me from competing in basically everything, is to restrictive.

Here is the deal... they put up all front money for attracting the attendees to the seminars.. aprox. 5k /cycle, and a cycle being 2 seminars in a week at good restaurant and all out of pocket expenses for ads mailings and all training .. basically the Group pays for everything including my office support from.. getting attendees there to after the sale support. Is 50/50 fair commissions after we release the out of town trainer who will receive one third to hold our hand and do the first presentations and closings.

My role will be as the presenter at seminar, fact finder, I will be presenter of the best solution for needs and then closer. I have been doing about 30 Medicare seminars in aep/ oep for 4 yrs. I have to transition to a more stable line of business.

The groups stated goal is to protect the their investment in me for the training and my replacement costs. Should we part ways. there is no time limit

Other thoughts are appreciated. Some of mine to included in the amendment to this agreement are... commissions are divided and paid from the insurance companies where we place the business per the application...I will not be constrained nor do I split Commissions I develop and place from my marketing an additions and referrals from existing clients. I want this "gig" and projections are promising with this system, as almost all are.

I know I have left out a lot of things ... do any have comments or suggestions. Yeah I hear ya...."get a lawyer"..... who knows nothing about this business.

Thanks in advance. I know this forum has a lot of good advise.

 

[djs]

Re: How to Negotiate a Non Compete Clause ...

What are you doing that isn't standard off the shelf stuff? As a presenter, or even a closer, why is a non-compete needed?

Let's remove the obvious, they don't want you going after their seminar attendees. Okay, I'll give them that. Are they more restrictive than limiting the scope of the market to those you had exposure? If so, tear up the contract, go elsewhere.

Dan

 

[padthaiforlunch]

Re: How to Negotiate a Non Compete Clause ...

Non-competes are nearly impossible to enforce, especially if your livelihood is at stake. The best that can be hoped for is confidentiality of client or prospective client lists and information, and any trade secrets, such as marketing materials.

Spend a hundred and talk to a lawyer who specializes in employment law.

 

[xrac]

Re: How to Negotiate a Non Compete Clause ...

Non-competes are nearly impossible to enforce, especially if your livelihood is at stake. The best that can be hoped for is confidentiality of client or prospective client lists and information, and any trade secrets, such as marketing materials.

Spend a hundred and talk to a lawyer who specializes in employment law.

I agree that they are mostly nonenforceable but you can still spend a ton of money on attroney fees defending yourself.

 

[somarco]

mostly nonenforceable but you can still spend a ton of money on attroney fees defending yourself.

Been there, done that. You speak the truth.

 

[Bertolinoins]

Maybe I am not understanding the situation correctly but it appears you have little leverage. The company is covering a significant expense to put you in front of prospects and they expect to get a the business if you are able to convert then to clients. Are you putting up any of your own money or do you just show up to speak and then follow up with those that attended?

 

[scagnt83]

but it appears you have little leverage.

I would agree. What makes you such a great presenter that you have the leverage to negotiate anything with them?? Do you have a track record with doing this? Previous results that you can show them?
If not, then you have no leverage since they are bankrolling everything.

 

[VolAgent]

You could probably ask them to admend the document, limiting the non-compete to non-solicitation of clients and prospects of the seminars, and not using their material once the relationship ends. Perhaps even restricting you from conducting business in the product lines that you sold during the seminars.

It sounds like these are Medicare driven seminars. How is it an infringement of their rights and business if you sell a life policy or health policy to a referral from an existing client?