A restrictive contract is a legal agreement that limits certain actions or behaviors of one or more parties involved. These contracts often include clauses that prevent individuals from engaging in specific activities, such as working for competitors or disclosing confidential information. The purpose is to protect business interests and maintain a competitive edge. Common examples of restrictive contracts include non-compete agreements and non-disclosure agreements. These contracts are typically used in employment settings, where employers want to safeguard their trade secrets and proprietary information. Violating a restrictive contract can lead to legal consequences, including financial penalties or injunctions.