A restraint of trade agreement is a common clause in sale of business agreements. The clause will protect the purchaser of the business by preventing the vendor (or business seller) from opening a competing business nearby.This agreement is to be used in a sale of business. Restrains the vendor and key people.
Restraints in a legal context restrict a person doing something for a certain time in a certain territory. They are most commonly seen in the context of a sale of business or employment situations