Free Confidentiality Agreement Template

DEFINITION OF CONFIDENTIAL INFORMATION

"Confidential Information" means any and all non-public, proprietary, or confidential information, in any form or medium, disclosed by the Disclosing Party to the Receiving Party, whether before or after the date of this Agreement, including without limitation: (a) trade secrets, inventions, ideas, processes, formulas, algorithms, source code, and know-how; (b) business plans, financial information, projections, budgets, and pricing data; (c) customer and supplier lists, contact information, and purchasing histories; (d) marketing strategies, advertising plans, and sales data; (e) technical data, specifications, designs, drawings, and prototypes; (f) personnel information, organizational structures, and compensation data; (g) legal strategies, pending litigation information, and regulatory compliance matters; and (h) any information that the Disclosing Party identifies as confidential or that a reasonable person would understand to be confidential given the nature of the information and the circumstances of disclosure. Confidential Information also includes any notes, analyses, compilations, studies, summaries, or other materials prepared by the Receiving Party that contain, reflect, or are derived from the Disclosing Party's Confidential Information. Information qualifying as a "trade secret" shall receive the full protections afforded by the federal Defend Trade Secrets Act of 2016 (18 U.S.C. Sections 1836-1839) and the Uniform Trade Secrets Act as enacted by the governing state (including, where applicable, Cal. Civ. Code Sections 3426.1-3426.11 (CUTSA), N.Y. common-law trade-secret principles recognized in Faiveley Transport Malmo AB v. Wabtec Corp., 559 F.3d 110 (2d Cir. 2009), or the equivalent state enactment). Acquisition of Confidential Information by "improper means" — including theft, bribery, misrepresentation, or industrial espionage of the type condemned in E.I. duPont deNemours and Co. v. Christopher, 431 F.2d 1012 (5th Cir. 1970) — and criminal misappropriation proscribed by 18 U.S.C. Section 1832 are expressly prohibited under this Agreement.

OBLIGATIONS OF RECEIVING PARTY

The Receiving Party agrees to: (a) hold all Confidential Information in strict confidence and protect it with at least the highest degree of care, but in no event less than a reasonable degree of care; (b) not disclose, publish, or disseminate any Confidential Information to any third party without the prior written consent of the Disclosing Party; (c) use the Confidential Information solely for the Permitted Purpose and for no other purpose whatsoever; (d) limit access to the Confidential Information to those of its employees, officers, directors, agents, and professional advisors who have a demonstrable need to know such information for the Permitted Purpose and who are bound by written confidentiality obligations no less protective than those contained herein; (e) be responsible for any breach of this Agreement by any of its employees, officers, directors, agents, or professional advisors; and (f) promptly notify the Disclosing Party in writing upon becoming aware of any unauthorized disclosure, use, or loss of any Confidential Information. The Receiving Party acknowledges that the Disclosing Party's Confidential Information constitutes valuable assets and that any unauthorized use or disclosure of such information could cause irreparable harm to the Disclosing Party.

STANDARD EXCLUSIONS

The obligations of confidentiality set forth in this Agreement shall not apply to any information that the Receiving Party can demonstrate by clear and convincing evidence: (a) was already in the public domain at the time of disclosure, or subsequently became publicly available through no act, omission, or fault of the Receiving Party; (b) was already known to or in the legitimate possession of the Receiving Party at the time of disclosure, free of any obligation of confidentiality, as evidenced by the Receiving Party's contemporaneous written records; (c) was independently developed by the Receiving Party without reference to, reliance upon, or use of any Confidential Information of the Disclosing Party, as demonstrated by documented evidence; or (d) was received by the Receiving Party in good faith from a third party who was not, to the Receiving Party's knowledge, under any obligation of confidentiality with respect to such information. The burden of proving that any of these exclusions applies shall rest solely with the Receiving Party.

COMPELLED DISCLOSURE

If the Receiving Party becomes legally compelled by applicable law, regulation, legal process, or valid order of a court or governmental authority to disclose any Confidential Information of the Disclosing Party, the Receiving Party shall: (a) provide the Disclosing Party with prompt written notice of such requirement prior to making any disclosure, to the extent legally permitted, so that the Disclosing Party may seek a protective order, confidential treatment, or other appropriate remedy; (b) cooperate fully with the Disclosing Party, at the Disclosing Party's expense, in any effort to resist, limit, or narrow the scope of the required disclosure; (c) disclose only that portion of the Confidential Information that is legally required to be disclosed, taking all reasonable steps to preserve the confidentiality of the remaining Confidential Information; and (d) use its best efforts to ensure that the Confidential Information so disclosed is afforded confidential treatment by the court or governmental authority to which it is disclosed. Any Confidential Information disclosed pursuant to a legal compulsion shall retain its confidential character for all other purposes under this Agreement.

NO LICENSE OR RIGHTS

Nothing in this Agreement shall be construed as granting to the Receiving Party any license, right, title, or interest in or to any Confidential Information of the Disclosing Party, or in any intellectual property rights therein, whether by implication, estoppel, or otherwise. All Confidential Information shall remain the sole and exclusive property of the Disclosing Party. The Disclosing Party makes no representation or warranty as to the accuracy, completeness, or fitness for a particular purpose of any Confidential Information, and all Confidential Information is provided "as is" without any warranty whatsoever. Nothing in this Agreement shall obligate the Disclosing Party to disclose any particular Confidential Information, or shall create any obligation to enter into any business relationship, contract, or transaction with the Receiving Party.

TERM

This Agreement shall become effective as of the Effective Date and shall remain in full force and effect for 3 years from the Effective Date (the "Term"), unless earlier terminated by the Disclosing Party upon written notice to the Receiving Party. The Disclosing Party may terminate this Agreement at any time by providing written notice to the Receiving Party. Upon expiration or termination, the Receiving Party's obligations under this Agreement shall continue for a period of 3 years following the date of expiration or termination with respect to all Confidential Information received during the Term.

ADDITIONAL RESTRICTIONS

The Receiving Party shall not reverse engineer, decompile, disassemble, or otherwise attempt to derive the source code, underlying structure, algorithms, or techniques embodied in any Confidential Information, whether in whole or in part, directly or indirectly, except to the extent that such restriction is expressly prohibited by applicable law. The Receiving Party shall not copy, reproduce, duplicate, or otherwise replicate any Confidential Information, in whole or in part, except as reasonably necessary for the Permitted Purpose. Any permitted copies shall contain the same proprietary and confidential notices and legends as the original materials. The Receiving Party shall maintain accurate records of all copies made and their locations. The Receiving Party shall implement and maintain commercially reasonable physical, electronic, and administrative security measures to protect the Confidential Information against unauthorized access, disclosure, use, modification, or destruction. Such measures shall include, without limitation: secure storage of physical materials; encryption of electronic files containing Confidential Information; password protection and access controls for systems containing Confidential Information; and regular training of personnel regarding their confidentiality obligations. Prior to disclosing any Confidential Information to any of its employees, agents, contractors, or representatives, the Receiving Party shall ensure that each such person: (i) has a demonstrable need to know the Confidential Information for the Permitted Purpose; (ii) has been informed of the confidential nature of the information; and (iii) is bound by written confidentiality obligations that are no less protective than those contained in this Agreement. The Receiving Party shall be fully responsible and liable for any breach of confidentiality by any such person.

BREACH NOTIFICATION

In the event that the Receiving Party becomes aware or reasonably suspects that any Confidential Information has been accessed, disclosed, used, or compromised in an unauthorized manner (a "Security Incident"), the Receiving Party shall: (a) notify the Disclosing Party in writing within twenty-four (24) hours of becoming aware of or reasonably suspecting the Security Incident; (b) provide all reasonably available details regarding the nature, scope, and cause of the Security Incident, including the specific Confidential Information that was or may have been compromised; (c) take all reasonable steps to contain, mitigate, and remediate the Security Incident and to prevent further unauthorized access, disclosure, or use; (d) cooperate fully with the Disclosing Party in investigating and responding to the Security Incident; and (e) not make any public statement regarding the Security Incident without the prior written consent of the Disclosing Party, except as required by applicable law.

RETURN OF MATERIALS

Upon written request by the Disclosing Party or upon expiration or termination of this Agreement, the Receiving Party shall, within 5 business days: (a) return to the Disclosing Party all originals and copies of all documents, materials, and other tangible items containing or embodying any Confidential Information; (b) permanently delete and destroy all electronic files, records, and data containing any Confidential Information from all computers, servers, storage devices, and other electronic media in the Receiving Party's possession or control, using industry-standard secure deletion methods that render the information unrecoverable; and (c) provide the Disclosing Party with a written certification, signed by an authorized representative of the Receiving Party, confirming that all Confidential Information has been returned, deleted, or destroyed in accordance with this Section. Notwithstanding the foregoing, the Receiving Party may retain one (1) archival copy of the Confidential Information solely for the purpose of monitoring compliance with this Agreement and any applicable legal or regulatory requirements, provided that such retained copy remains subject to all confidentiality obligations of this Agreement.

REMEDIES

The Receiving Party acknowledges and agrees that the Confidential Information is valuable and that any unauthorized disclosure or use of the Confidential Information could cause irreparable harm to the Disclosing Party for which monetary damages alone would be an inadequate remedy. Accordingly, the Disclosing Party shall be entitled to seek immediate injunctive or other equitable relief from any court of competent jurisdiction to prevent or restrain any actual or threatened breach of this Agreement, without the necessity of proving actual damages, posting any bond or other security, or establishing that monetary damages would be an inadequate remedy. Such equitable relief shall be in addition to, and not in lieu of, any other remedies available to the Disclosing Party at law or in equity, including the recovery of monetary damages. In addition to any equitable relief, the Parties agree that in the event of a breach of this Agreement by the Receiving Party, the Receiving Party shall pay to the Disclosing Party, as liquidated damages and not as a penalty, the sum of 50,000.00 USD per breach, which the Parties acknowledge and agree represents a reasonable estimate of the anticipated damages that the Disclosing Party would sustain as a result of such breach, given the difficulty of calculating actual damages. The payment of liquidated damages shall not limit the Disclosing Party's right to seek additional damages for any losses that exceed the liquidated damages amount.

DTSA WHISTLEBLOWER IMMUNITY NOTICE

Pursuant to 18 U.S.C. Section 1833(b) of the Defend Trade Secrets Act of 2016, the Receiving Party is hereby notified that an individual shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that: (i) is made in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney, and solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. An individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order. This notice is provided as a condition for recovery of exemplary damages and attorneys' fees under 18 U.S.C. Section 1833(b)(3). Nothing in this Agreement shall be construed to prohibit or restrict any disclosure expressly protected by 18 U.S.C. Section 1833(b), Section 21F of the Securities Exchange Act of 1934 (15 U.S.C. Section 78u-6), or any other whistleblower or anti-retaliation provision.

GOVERNING LAW AND JURISDICTION

This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to its conflict of laws principles. Any dispute, controversy, or claim arising out of or relating to this Agreement shall be resolved exclusively in the state or federal courts located in the State of California; provided that any agreement by the Parties to submit disputes to arbitration shall be governed and enforced under the Federal Arbitration Act, 9 U.S.C. Sections 1-16. Notwithstanding the foregoing, if the Receiving Party is an individual who primarily resides and works in California, this choice-of-law and forum-selection provision shall be subject to California Labor Code Section 925, which may render such clauses voidable at the employee's election where the employee was not independently represented by legal counsel in negotiating this Agreement. The application of the doctrine of "inevitable disclosure" (recognized in some states such as Illinois (PepsiCo, Inc. v. Redmond, 54 F.3d 1262 (7th Cir. 1995)) but rejected in others, including California (Whyte v. Schlage Lock Co., 101 Cal. App. 4th 1443 (2002))) shall be determined under the governing state's law. Each Party hereby irrevocably consents to the personal jurisdiction of the foregoing courts and waives any objection to venue or any claim that any such action or proceeding has been brought in an inconvenient forum.

GENERAL PROVISIONS

Entire Agreement: This Agreement constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous discussions, negotiations, understandings, and agreements. Amendment: No amendment or modification of this Agreement shall be valid unless made in writing and signed by both Parties. Severability: If any provision of this Agreement is held to be invalid, illegal, or unenforceable, the remaining provisions shall remain in full force and effect, and the invalid provision shall be modified to the minimum extent necessary to make it valid and enforceable. Waiver: The failure of either Party to enforce any provision of this Agreement shall not constitute a waiver of that Party's right to enforce such provision in the future. Assignment: The Receiving Party may not assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the Disclosing Party. Counterparts: This Agreement may be executed in counterparts, including electronic counterparts, each of which shall be deemed an original. Notices: All notices under this Agreement shall be in writing and delivered to the addresses set forth above or to such other address as either Party may designate in writing.