By Carona                                        S.B. No. 885

      75R8024 LJR-F                           

                                A BILL TO BE ENTITLED

 1-1                                   AN ACT

 1-2     relating to limitations on certain covenants.

 1-3           BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

 1-4           SECTION 1.  Section 15.50, Business & Commerce Code, is

 1-5     amended to read as follows:

 1-6           Sec. 15.50.  CRITERIA FOR ENFORCEABILITY OF COVENANTS NOT TO

 1-7     COMPETE.  Notwithstanding Section 15.05 of this code, a covenant

 1-8     not to compete is  enforceable if it is ancillary to or part of an

 1-9     otherwise enforceable agreement or otherwise valid transaction or

1-10     relationship, except [at the time the agreement is made] to the

1-11     extent that it contains limitations on [as to time, geographical

1-12     area, and] scope of activity, duration, or territory [to be

1-13     restrained] that are unreasonable and that it imposes a [reasonable

1-14     and do not impose a greater] restraint greater than is necessary to

1-15     protect the goodwill or other business interest of the promisee.

1-16           SECTION 2.  This Act takes effect September 1, 1997.

1-17           SECTION 3.  The importance of this legislation and the

1-18     crowded condition of the calendars in both houses create an

1-19     emergency and an imperative public necessity that the

1-20     constitutional rule requiring bills to be read on three several

1-21     days in each house be suspended, and this rule is hereby suspended.