TRADE SECRET PROTECTION AGREEMENT

(Arizona – Comprehensive Form)

[// GUIDANCE: This template reflects Arizona’s adoption of the Uniform Trade Secrets Act (“AUTSA”) and is drafted for a unilateral disclosure (i.e., only the Discloser shares Trade Secrets). Convert to mutual by adjusting defined terms and dual-party obligations as needed.]

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Operative Provisions
4. Representations & Warranties
5. Covenants & Restrictions
6. Default & Remedies
7. Risk Allocation
8. Dispute Resolution
9. General Provisions
10. Execution Block

1. DOCUMENT HEADER

1.1 Title

TRADE SECRET PROTECTION AGREEMENT

1.2 Parties

This Trade Secret Protection Agreement (the “Agreement”) is entered into as of [EFFECTIVE DATE] (the “Effective Date”) by and between:

a. [PARTY A LEGAL NAME], a [STATE OF FORMATION] [ENTITY TYPE] having its principal place of business at [ADDRESS] (“Discloser”); and
b. [PARTY B LEGAL NAME], a [STATE OF FORMATION] [ENTITY TYPE] having its principal place of business at [ADDRESS] (“Recipient”).

Discloser and Recipient are sometimes referred to individually as a “Party” and collectively as the “Parties.”

1.3 Recitals

A. Discloser possesses valuable Trade Secrets and other Confidential Information.
B. Recipient desires to receive certain of Discloser’s Trade Secrets solely for the Purpose (defined below) and is willing to protect such information on the terms and conditions set forth herein.
C. The Parties intend that this Agreement strictly comply with the Arizona Uniform Trade Secrets Act, and agree that Arizona substantive law shall govern all disputes.

NOW, THEREFORE, in consideration of the mutual promises herein and for other good and valuable consideration, the sufficiency of which is acknowledged, the Parties agree as follows:

2. DEFINITIONS

[// GUIDANCE: Definitions are drafted to align with AUTSA terminology. Edit or supplement as necessary for deal-specific terms.]

“Confidential Information” means all non-public information disclosed by Discloser, whether oral, visual, written, electronic, or in any other form, that is designated as confidential or that a reasonable person would understand to be confidential given the nature of the information and the circumstances of disclosure, including but not limited to Trade Secrets. Confidential Information excludes information that Recipient can demonstrate by competent evidence: (a) is or becomes publicly available without breach of this Agreement; (b) was rightfully known to Recipient prior to disclosure; (c) is independently developed by Recipient without use of or reference to Discloser’s Confidential Information; or (d) is rightfully obtained by Recipient from a third party without restriction.

“Improper Means” has the meaning assigned under the Arizona Uniform Trade Secrets Act and includes, without limitation, theft, bribery, misrepresentation, breach or inducement of a breach of a duty to maintain secrecy, or espionage through electronic or other means.

“Misappropriation” means: (a) acquisition of a Trade Secret by a person who knows or has reason to know that the Trade Secret was acquired by Improper Means; or (b) disclosure or use of a Trade Secret without express or implied consent by a person who (i) used Improper Means to acquire knowledge of the Trade Secret; (ii) at the time of disclosure or use, knew or had reason to know that his/her knowledge of the Trade Secret was derived from or through a person who had utilized Improper Means, or was acquired under circumstances giving rise to a duty to maintain its secrecy, or derived from a person owing such a duty; or (iii) before a material change of position, knew or had reason to know that it was a Trade Secret and that knowledge of it had been acquired by accident or mistake.

“Purpose” means [INSERT SPECIFIC PURPOSE, e.g., “evaluating a potential strategic partnership regarding XYZ technology”].

“Trade Secret” means information, including a formula, pattern, compilation, program, device, method, technique, or process, that (a) derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and (b) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

3. OPERATIVE PROVISIONS

3.1 Grant of Limited Right

Discloser hereby grants Recipient a limited, non-exclusive, non-transferable, revocable license to use the Confidential Information solely for the Purpose and strictly in accordance with this Agreement.

3.2 Non-Disclosure and Safeguarding Obligations

a. Recipient shall protect the Confidential Information with at least the same degree of care it uses to protect its own confidential information of like importance, but in no case less than a commercially reasonable standard of care.
b. Recipient shall restrict disclosure of Confidential Information to its employees, officers, directors, agents, and professional advisors (collectively “Representatives”) with a need to know for the Purpose, and only after such Representatives have been advised of, and are bound by, confidentiality obligations no less protective than those contained herein.
c. Recipient shall not, and shall cause its Representatives not to, copy, reverse engineer, disassemble, decompile, or otherwise attempt to derive the composition or underlying information of any Trade Secret except to the extent expressly permitted in writing by Discloser.

3.3 Mandatory Notice of Compelled Disclosure

If Recipient or any of its Representatives is legally compelled by subpoena, court order, or other governmental demand to disclose any Confidential Information, Recipient shall promptly notify Discloser in writing, cooperate with Discloser’s efforts to seek protective relief, and disclose only that portion of the Confidential Information that Recipient’s counsel advises is legally required.

3.4 Return/Destruction

Upon the earlier of (a) Discloser’s written request; (b) completion or abandonment of the Purpose; or (c) termination of this Agreement, Recipient shall promptly (i) cease all use of Confidential Information, and (ii) at Discloser’s election, return or irretrievably destroy all Confidential Information and certify such destruction in writing.

3.5 Consideration

The Parties acknowledge that the mutual promises herein constitute adequate consideration, including Discloser’s promise to provide access to valuable Trade Secrets.

4. REPRESENTATIONS & WARRANTIES

4.1 Mutual Authority. Each Party represents that it is duly organized, validly existing, and in good standing under the laws of its jurisdiction of formation, and that execution and performance of this Agreement have been duly authorized.

4.2 Discloser’s Warranty of Title. Discloser represents that it has the right to disclose the Confidential Information to Recipient for the Purpose and that such disclosure does not violate any contractual or legal obligation.

4.3 Recipient’s Warranty of Compliance. Recipient represents that it will comply with all applicable laws, including export control and data protection laws, in connection with its handling of Confidential Information.

4.4 Disclaimer of Other Warranties. Except as expressly stated, Confidential Information is provided “AS IS,” without warranty of any kind, whether express, implied, statutory, or otherwise, including warranties of merchantability, fitness for a particular purpose, or non-infringement.

[// GUIDANCE: Consider adding a representation regarding cybersecurity posture if sensitive data will be shared.]

5. COVENANTS & RESTRICTIONS

5.1 Affirmative Covenants
a. Recipient shall implement and maintain administrative, technical, and physical safeguards no less stringent than those required under [INSERT APPLICABLE SECURITY STANDARD, e.g., “NIST SP 800-171”] to protect Trade Secrets.
b. Recipient shall, upon reasonable prior notice, allow Discloser to audit Recipient’s compliance with this Agreement (no more than once per twelve-month period unless a breach is suspected).

5.2 Negative Covenants
Recipient shall not (a) use Confidential Information to compete with Discloser; (b) file any patent application based on or incorporating Discloser’s Trade Secrets; or (c) otherwise Misappropriate any Trade Secret.

6. DEFAULT & REMEDIES

6.1 Events of Default
The following constitute a default:
i. Any Misappropriation or threatened Misappropriation of a Trade Secret;
ii. Breach of any obligation under § 3.2 (Non-Disclosure), § 3.4 (Return/Destruction), or § 5.2 (Negative Covenants); or
iii. Recipient’s failure to cure any other breach within [10] days after written notice.

6.2 Remedies
a. Injunctive Relief. The Parties agree that any breach of this Agreement would cause irreparable harm for which monetary damages are inadequate. Discloser is therefore entitled to immediate injunctive relief, temporary restraining orders, and specific performance, without posting bond or proving actual damages, in any court of competent jurisdiction in Arizona.
b. Damages. Discloser may recover (i) actual losses; (ii) the amount by which Recipient has been unjustly enriched; and (iii) exemplary damages of up to two times the actual damages for willful and malicious Misappropriation, consistent with AUTSA.
c. Attorney Fees. The prevailing Party in any action to enforce this Agreement shall recover its reasonable attorney fees and costs.

[// GUIDANCE: Subsection (b) mirrors AUTSA § 4; adjust multipliers if Arizona amends the statute.]

7. RISK ALLOCATION

7.1 Indemnification

Recipient shall indemnify, defend, and hold harmless Discloser, its affiliates, and their respective officers, directors, employees, and agents (collectively “Indemnitees”) from and against any and all claims, damages, losses, liabilities, penalties, judgments, costs, and expenses (including reasonable attorney fees) arising out of or relating to (a) any Misappropriation of a Trade Secret; (b) any breach of this Agreement by Recipient or its Representatives; or (c) Recipient’s negligent or wrongful acts or omissions.

7.2 Limitation of Liability

NO LIMITATION OF LIABILITY SHALL APPLY TO A PARTY’S INDEMNIFICATION OBLIGATIONS, MISAPPROPRIATION, OR BREACH OF CONFIDENTIALITY. ALL LIABILITY CAPS (CONTRACTUAL OR STATUTORY) ARE EXPRESSLY WAIVED.

7.3 Insurance

Recipient shall, for the Term and two (2) years thereafter, maintain commercial general liability and cyber liability insurance with minimum limits of [INSERT LIMITS] per occurrence, naming Discloser as an additional insured upon request.

7.4 Force Majeure

Neither Party shall be liable for delay or failure in performance (other than payment or confidentiality obligations) caused by events beyond its reasonable control, including acts of God, war, terrorism, civil unrest, pandemic, or government order, provided the affected Party promptly notifies the other and resumes performance as soon as practicable.

8. DISPUTE RESOLUTION

8.1 Governing Law

This Agreement and any dispute arising hereunder shall be governed by and construed in accordance with the laws of the State of Arizona, without regard to its conflict-of-laws principles.

8.2 Forum Selection & Jurisdiction

Subject to § 8.3 (Arbitration), the state courts located in [MARICOPA COUNTY], Arizona shall have exclusive jurisdiction. Each Party irrevocably submits to such venue and waives any objection on grounds of forum non conveniens.

8.3 Arbitration

a. Any controversy or claim arising out of or relating to this Agreement that cannot be resolved amicably within [30] days shall be settled by binding arbitration administered by [ARBITRATION PROVIDER] under its [ARBITRATION RULES].
b. The arbitral tribunal shall consist of one (1) neutral arbitrator experienced in trade secret law. The seat of arbitration shall be [PHOENIX, ARIZONA].
c. The arbitrator shall apply Arizona substantive law and may award any relief available under AUTSA, including injunctive relief.
d. Notwithstanding the foregoing, either Party may seek provisional or injunctive relief in a state court of competent jurisdiction in Arizona to prevent or halt Misappropriation.

8.4 Jury Trial Waiver

TO THE EXTENT ANY CLAIM IS NOT SUBJECT TO ARBITRATION, THE PARTIES HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY.

8.5 Equitable Relief Preservation

The Parties’ rights to injunctive and other equitable relief under § 6.2(a) survive any termination of this Agreement and are not contingent upon submission of a dispute to arbitration.

9. GENERAL PROVISIONS

9.1 Amendment & Waiver. No amendment or waiver of any provision of this Agreement is effective unless set forth in a written instrument signed by both Parties. No failure or delay in exercising any right, remedy, power, or privilege operates as a waiver.

9.2 Assignment. Recipient may not assign or delegate its rights or obligations hereunder, whether by operation of law or otherwise, without Discloser’s prior written consent, except to a successor in connection with a merger or sale of substantially all assets, provided that successor assumes all obligations in writing. Any purported assignment in violation of this § 9.2 is void.

9.3 Successors & Assigns. This Agreement is binding upon and inures to the benefit of the Parties and their respective permitted successors and assigns.

9.4 Severability. If any provision is held invalid or unenforceable, the remaining provisions remain in full force, and the invalid provision shall be reformed to the minimum extent necessary to achieve its intent and economic effect.

9.5 Integration. This Agreement constitutes the entire understanding between the Parties with respect to its subject matter and supersedes all prior or contemporaneous agreements or understandings, whether written or oral.

9.6 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts (including by facsimile, PDF, or electronic signature), each of which is deemed an original, and all of which together constitute one and the same instrument.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the Effective Date.

[// GUIDANCE: Notarization is NOT required for enforceability under Arizona law; include only if client or international use cases demand.]