General Contract Clauses: Confidentiality Agreement Clauses After

Resource ID: w-002-9194

Standard Clauses for use in conﬁdentiality agreements drafted

after the Defend Trade Secrets Act of 2016 (DTSA). These Standard

Clauses include whistleblower protections and notice of immunity

provisions for agreements with employees and certain contractors

and consultants. They also include other clauses that should be

reviewed for business-to-business transactions. These Standard

Clauses have integrated notes with important explanations and

drafting and negotiating tips.

The Defend Trade Secrets Act of 2016

(DTSA) (18 U.S.C. §§1831-1836) became

effective on May 11, 2016, creating a federal

private cause of action for trade secret

misappropriation that occured on or occurs

after the effective date. Private parties can

now bring civil trade secret claims in federal

court. Confidentiality agreements typically

address the handling and protection of

trade secrets by the parties. Before the

DTSA, confidentiality agreements were

traditionally governed by state law. Like

most state trade secrets laws, the DTSA is

modeled after the Uniform Trade Secrets

Act (UTSA) and contains similar remedies.

However, the DTSA has unique provisions

that require renewed consideration

when drafting or revising confidentiality

agreements with:

 Employees, consultants, and contractors.

 Potential and actual business partners.

These unique provisions address:

 Protection for whistleblowers.

This protection must be addressed

appropriately for a company to take full

advantage of the enforcement rights and

remedies allowed under the DTSA (see

Drafting Note, Notice of Immunity Under

the Economic Espionage Act of 1996).

 The DTSA not preempting state laws.

Parties may bring claims for trade secret

misappropriation under the DTSA and

combine them with state law claims (18

U.S.C. §1838) (see Drafting Notes, Choice

of Forum and Choice of Law).

 Civil ex parte seizures. In extreme

situations, the DTSA authorizes courts

to order seizure of property (18 U.S.C.

§1836(b)(2)).

These Standard Clauses include a notice

of immunity provision which is required

DRAFTING NOTE: READ THIS BEFORE USING DOCUMENT

CHARLES R. MACEDO AND MICHAEL SEBBA, AMSTER, ROTHSTEIN & EBENSTEIN LLP,

WITH PRACTICAL LAW COMMERCIAL TRANSACTIONS

General Contract Clauses:

Conﬁdentiality Agreement Clauses

After the Defend Trade Secrets Act

Search the Resource ID numbers in blue on Practical Law for more.

COURTESY OF AMSTER, ROTHSTEIN & EBENSTEIN LLP

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

under the DTSA for agreements with

employees and contractors (see Clause 1).

The other Standard Clauses are common in

confidentiality agreements and the drafting

notes mainly focus on the DTSA’s possible

implications.

For a general discussion of the DTSA in

the context of trade secrets litigation, see

Practice Note, Trade Secrets Litigation:

Defend Trade Secrets Act(5-523-8283).

For further discussion of confidentiality

agreements generally, see Practice

Note, Confidentiality and Nondisclosure

Agreements(7-501-7068) and other

resources included in the Confidentiality

and Nondisclosure Agreements

Toolkit(3-502-1883). For more information

on employee confidentiality agreements,

see Standard Document, Employee

Confidentiality and Proprietary Rights

Agreement(6-501-1547).

ASSUMPTIONS

The notice of immunity provision assumes

that it will be used in an agreement between

a company and an employee, consultant,

or contractor (see Clause 1). That provision

is drafted to address protections that the

DTSA affords to employees, consultants,

and certain contractors and, therefore, is not

written as a business-to-business clause.

The other Standard Clauses assume that:

 The clauses are used in a mutual

agreement, which assumes that both

parties are disclosing and receiving

confidential information. The other

Standard Clauses should not be used if

only one party is disclosing confidential

information. In addition, those Standard

Clauses must be revised if the parties

are not sharing confidential information

on a fully mutual basis and the parties

are instead entering into a reciprocal

confidentiality agreement that contains

party-specific rights and obligations to

reflect any differences in the scope and

type of confidential information that each

party expects to disclose (see Practice

Note, Confidentiality and Nondisclosure

Agreements: Mutual Confidentiality

Agreements(7-501-7068)).

 The parties to the agreement are US

entities and the transaction takes place

in the US. If any party is organized or

operates in, or any transaction takes

place in a foreign jurisdiction, these terms

may need to be modified to comply with

applicable laws in the relevant foreign

jurisdictions.

 These terms are not industry-specific.

The other Standard Clauses do not

account for any industry-specific laws,

rules, or regulations that may apply

in certain transactions. Some of these

Standard Clauses may not be enforceable,

either because of applicable state law,

industry-specific regulations, or other

rules and regulations applicable to

the parties. Parties should check all

applicable laws and regulations to ensure

the Standard Clauses included in the

agreement are enforceable as drafted.

 Capitalized terms are defined elsewhere

in the agreement. Certain terms are

capitalized but not defined in the other

Standard Clauses because it is assumed

that they are defined elsewhere in the

agreement (for example, Agreement,

Business Opportunity, Business Purpose,

Company, Contractor, Disclosing Party,

Employee, Employer, Litigation, Parties,

and Receiving Party).

BRACKETED ITEMS

Bracketed items in ALL CAPS should be

completed with the transaction’s facts.

Bracketed items in sentence case are either

optional provisions or include alternative

language choices to be selected, added, or

deleted at the drafter’s discretion.

1. Notice of Immunity Under the Economic Espionage Act of 1996, as amended by the Defend

Trade Secrets Act of 2016.

[Notwithstanding any other provision of this Agreement:

(a) [Contractor/Employee] will not be held criminally or civilly liable under any federal or state

trade secret law for any disclosure of a trade secret that:

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

(i) is made:

(A) in confidence to a federal, state, or local government official, either directly or

indirectly, or to an attorney; and

(B) solely for the purpose of reporting or investigating a suspected violation of law; or

(ii) is made in a complaint or other document that is filed under seal in a lawsuit or other

proceeding.

(b) If [Contractor/Employee] files a lawsuit for retaliation by [Company/Employer] for reporting

a suspected violation of law, [Contractor/Employee] may disclose [Company’s/Employer’s]

trade secrets to [Contractor’s/Employee’s] attorney and use the trade secret information in the

court proceeding if [Contractor/Employee]:

(i) files any document containing the trade secret under seal; and

(ii) does not disclose the trade secret, except pursuant to court order.

[Contractor/Employee] acknowledges receipt of [Company/Employer’s] [NAME OF REPORTING

POLICY FOR A SUSPECTED VIOLATION] setting forth:

(a) [Company’s/Employer’s] reporting policy for a suspected violation of law; and

(b) Notice of immunity from criminal and civil liability for certain disclosures of trade secrets

under the Defend Trade Secrets Act of 2016 (18 U.S.C. §1833(b)).]

If the confidentiality agreement is with

an individual employee, consultant, or

contractor, the trade secret owner must:

 Be aware of whistleblower protections

provided by the DTSA.

 Include the notice of immunity to preserve

the full extent of its rights and remedies

afforded by the DTSA.

DTSA’S WHISTLEBLOWER PROTECTION

The DTSA provides employees with

immunity to both criminal and civil liability

for trade secret misappropriation under the

DTSA and any state trade secret law if the

trade secret disclosure is made either:

 In confidence and solely for the purpose

of reporting or investigating a suspected

violation of law to:

z

a federal, state, or local government

official; or

z

to an attorney.

 In a filing in a lawsuit or other proceeding,

made under seal.

(18 U.S.C. §1833(b)(1).)

Under the DTSA, the term “employees”

includes individuals who are:

 Employees.

 Independent contractors.

 Consultants.

(18 U.S.C. §1833(b)(4).)

The DTSA also permits individuals filing a

lawsuit for retaliation by an employer to:

 Disclose the employer’s trade secret to an

attorney.

 Use the trade secret in the court

proceeding.

The individual must both:

 File any document containing the trade

secret under seal.

 Not disclose the trade secret, except

under court order.

(18 U.S.C. §1833(b)(2).)

NOTICE OF IMMUNITY REQUIREMENT

Confidentiality agreements with employees

(defined under the DTSA to include

DRAFTING NOTE: NOTICE OF IMMUNITY UNDER THE ECONOMIC ESPIONAGE

ACT OF 1996

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

2. Recitals.

[WHEREAS, Disclosing Party has a business opportunity associated with intellectual property

and/or proprietary information relating to, inter alia, [DESCRIPTION OF PRODUCT OR SERVICE],

which is intended for use in interstate or foreign commerce (the “Business Opportunity”); and

WHEREAS, Disclosing Party has a business opportunity associated with intellectual property

and/or proprietary information relating to, inter alia, [DESCRIPTION OF PRODUCT OR SERVICE],

which is intended for use solely within the State of [STATE] (the “Business Opportunity”); and]

contractors and consultants) must provide

written notice of the DTSA’s immunity

provisions. Failure to provide notice waives

the employer’s rights to exemplary damages

or attorneys’ fees against that employee

who did not receive the notice. For further

discussion of consequences for failure

to provide notice, see Standard Clause,

Notice of Immunity Under the Defend Trade

Secrets Act (DTSA) Provision: Drafting Note:

Consequences for Failure to Provide DTSA

Notice(w-003-5261).

This Standard Clause directly tracks the

statutory language. It has optional language

to address either:

 An employment relationship, referring to

the individual as an “Employee” and the

business entity as the “Employer.”

 An independent contractor relationship,

referring to the individual as a “Contractor”

and the business entity as “Company.”

It also includes alternative language based

on the DTSA provision which states that an

employer may provide the required notice by

reference to a policy document:

 Setting out the employer’s reporting

policy for a suspected violation of the law.

 Providing notice of the DTSA’s immunity

provisions.

(18 U.S.C. §1833(b)(3).)

For further discussion of the notice of

immunity provisions and the practical

implications, see:

 Standard Clause, Notice of Immunity

Under the Defend Trade Secrets

Act (DTSA) Provision: Drafting

Notes: Consequences for Failure to

Provide DTSA Notice(w-003-5261)

and PracticalImplications for

Employers(w-003-5261).

 Standard Document, Employee

Confidentiality and Proprietary Rights

Agreement: Drafting Note: Notice of

Immunity Under the Defend Trade Secrets

Act of 2016(6-501-1547).

 Standard Document, Independent

Contractor/Consultant Agreement (Pro-

Client): Drafting Note: Notice of Immunity

Under the Defend Trade Secrets Act of

2016(2-500-4638).

INTRASTATE VERSUS INTERSTATE

A prerequisite to invoking the DTSA is

that the trade secret concerns a product

or service involved in interstate or foreign

commerce (18 U.S.C. §1832(a)). If there is

no intent evidenced in the agreement, a

court will review the nature of the actual

purportedly wrongful activities and

may invoke only state law or state and

federallaw. The parties can use the recitals

to demonstrate the nature of the activities

and inform the court’s analysis.

These alternative provisions enable the

parties to demonstrate that the information

relates to products or services that are either:

 Used in or intended for use in interstate or

foreign commerce.

DRAFTING NOTE: RECITALS

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

3. Confidential Information.

“Confidential Information” means[, except as set forth below,] any facts, opinions, conclusions,

projections, data, information, trade secrets, patents, patent applications, inventions, software,

hardware, or know-how relating to any work in process, future development, sales, marketing,

financial, or personnel matter relating to (a) the Business Opportunity; and (b) Disclosing Party

or its affiliates, its present or future development, sales, marketing, financial, or personnel

matter relating to Disclosing Party, its present or future products, patents, patent applications,

technology, inventions, know how, sales, customers, employees, investors, prospects, markets, or

business, whether communicated orally or in writing or obtained by the Receiving Party through

observation or examination of Disclosing Party’s facilities, documents, or procedures.

 Only offered within the borders of a single

state.

The first alternative can help the parties

invoke the DTSA. If the confidential

information relates to products or services

offered within a single state, the second

alternative can support a position that the

DTSA does not apply.

Most confidentiality agreements include a

definition of information to be protected.

Parties can invoke protection under the

DTSA for the following types of information:

 Financial.

 Business.

 Scientific.

 Technical.

 Economic.

 Engineering.

(18 U.S.C. §1839(3).)

DTSA protections apply if:

 The owner takes reasonable measures to

keep the information secret.

 The information derives actual or

potential independent economic value

from not being generally known to, and

not being readily and properly ascertained

by, other persons who can use it for

economic gain.

(18 U.S.C. §1839(3).)

These requirements have two implications

to the DTSA’s application:

 Certain types of information may not

be covered. The Confidential Information

definition in this clause is consistent with

the categories specified in the DTSA. Most

trade secrets should be covered by the

DTSA. However, courts may interpret the

act narrowly and, if the parties add other

types of information, they should ensure

that the description is consistent with

categories listed in the DTSA.

 The secrecy must create value and the

owner must take steps to protect the

information. For the DTSA to apply,

a party must demonstrate that there

is some economic value derived from

the information’s secrecy and it not

being readily ascertainable. The parties

should also consider taking reasonable

measures to ensure that the information is

protected. For example, they should:

z

show that they take measures to

protect their own data; and

z

consider adding additional

requirements, such as a marking

provision, if it is appropriate (see

Drafting Note, Marking Confidential

Information).

If a marking provision is included,

the drafter should consider including

the bracketed text in this clause (see

Clause4).

If the DTSA does not apply to the

information, a party may need to pursue

DRAFTING NOTE: CONFIDENTIAL INFORMATION: DEFINITION

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

4. Marking.

[Confidential Information shall not include any [written] information disclosed under this

Agreement unless it is conspicuously marked “Confidential” at the time of disclosure.]

[Confidential Information shall not include information that is disclosed orally, visually, or in

another form that [is difficult to mark/cannot be tangibly marked] unless Disclosing Party,

within fifteen (15) days of the disclosure, delivers a tangible version of the information marked

“Confidential”, or in the case of information that is not amenable to tangible form, a writing

describing the information and marked “Confidential.”]

[If disclosed information should reasonably be recognized by Receiving Party as confidential, then

Disclosing Party’s inadvertent failure to mark the information as Confidential shall not result in

the information being deemed to be non-confidential under this Agreement.]

state law claims for misappropriation,

unfair competition, or breach of contract.

For further discussion of the definition

of Confidential Information, see Practice

Note, Confidentiality and Nondisclosure

Agreements: Definition of Confidential

Information(7-501-7068).

Parties must determine whether and to

what extent confidential information should

be marked. The parties should carefully

consider the inclusion of a marking clause

as courts have held that failure to mark

removes the unmarked information from

the agreement’s protection. Marking

requirements can increase both:

 The certainty of what information is

protected as confidential under the

agreement’s terms.

 The risk that a party’s valuable

information may become unprotected

after an inadvertent failure to mark.

Marking clauses are beneficial when the

parties anticipate the dissemination of

a large volume of information between

the parties and with only a small portion

being confidential. In these situations, both

parties benefit by having clear instruction

on what information is confidential.

However, marking clauses can create an

excessive administrative burden when

most information disclosed between

parties will be confidential. This Standard

Clause provides three alternative marking

provisions that counsel can choose from or

combine:

 A strict marking option.

 A permissive option that includes a catch

up clause permitting retroactive marking

to remedy any failures to mark.

 A more permissive option which requires

the receiving party to treat as confidential

information that should be reasonably

understood to be confidential even if

there is an inadvertent failure to mark.

DTSA protections apply if the owner

takes reasonable measures to keep the

information secret (18 U.S.C. §1839(3)).

When considering a marking clause, a

party should evaluate whether the process

would support an argument that they

took reasonable measures to protect the

information.

DRAFTING NOTE: MARKING CONFIDENTIAL INFORMATION

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

5. Exclusions.

Receiving Party, however, shall have no liability to Disclosing Party under this Agreement with

respect to the disclosure and/or use of any such Confidential Information that it can establish:

(a) has become generally known or available to the public without breach of this Agreement

by the Receiving Party.

(b) was known by the Receiving Party, as established by its [written] records, before receiving

such information from Disclosing Party; or

information to it by Disclosing Party from a source other than Disclosing Party, without, to

Receiving Party’s knowledge, any breach of any obligation of confidentiality owed to Disclosing

Party.

Traditionally, confidentiality agreements

also address required disclosures, such as

disclosures required by law or regulation.

Examples include:

 Response to a subpoena or court order.

 A public company’s reporting obligations to

the Securities and Exchange Commission

or another regulatory authority.

It is still appropriate for parties to

include required disclosure language

under the DTSA. For further discussion,

see Practice Note, Confidentiality and

Nondisclosure Agreements: Nondisclosure

Obligations(7-501-7068).

There are circumstances where trade

secrets are no longer deemed protectable

and courts will not continue to enforce

confidentiality obligations in certain

situations. Parties traditionally address

those circumstances by including exclusions

from the confidential information definition.

Those exclusions include situations where:

 The information is no longer confidential

through no fault of the receiving party.

 The receiving party already knew about

the alleged trade secret without any

wrongdoing.

It is still appropriate for parties to include

these traditional exclusions under the

DTSA. For further discussion, see Practice

Note, Confidentiality and Nondisclosure

Agreements: Exclusions from the

Definition(7-501-7068).

DRAFTING NOTE: EXCLUSIONS

DRAFTING NOTE: REQUIRED DISCLOSURES

6. Required Disclosures.

Receiving Party may disclose Confidential Information if and to the extent that such disclosure

is required by applicable law, regulation, or court order, provided that Receiving Party (i) uses

reasonable efforts, at Disclosing Party’s expense, to limit the disclosure by means of a protective

order or a request for confidential treatment and (ii) provides Disclosing Party [a reasonable

opportunity/at least ten (10) business days] to review, if permitted, the disclosure before it is made

and to interpose its own objection to the disclosure.

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

7. Confidentiality Obligations.

Receiving Party acknowledges that irreparable injury and damage may result from disclosure

of Confidential Information to any parties or individuals not expressly authorized under this

Agreement or use by Receiving Party for any purpose other than the Business Purpose. Receiving

Party shall[:

(a) hold Confidential Information in [strict] confidence;

(b) disclose such Confidential Information only to individuals who Receiving Party warrants

and represents have agreed in writing to be bound by the terms and conditions of this

Agreement;

takes in the procedures it follows to avoid disclosure of its own confidential information of a

similar nature, to prevent the unauthorized disclosure of Confidential Information, including,

without limitation, protection of documents from theft, unauthorized duplication, and discovery

of contents, and restrictions on access by other persons to such Confidential Information; and

(d) not to use any Confidential Information for any purpose other than the Business Purpose.

take [all] [reasonable] precautions, at least consistent with the precautions Receiving Party

takes in the procedures it follows to protect its own confidential information of a similar nature,

to prevent unauthorized copying, duplication, sketching, drawing, photographing, downloading,

uploading, alteration, destruction, photocopying, replicating, transmitting, delivering,

sending, mailing, communicating, or conveying of Confidential Information, and to take [all]

[reasonable] precautions, at least consistent with the precautions Receiving Party takes in the

procedures it follows to protect its own confidential information of a similar nature, against

theft, unauthorized sale, or unauthorized conveyance obtained through fraud, deception,

misrepresentation, or bribery of Confidential Information.]

The purpose of entering into a

confidentiality agreement is to ensure the

protection of confidential information. The

DTSA recognizes that establishing the

protectability of a trade secret requires the

trade secret owner to take precautions to

protect the trade secret (18 U.S.C. §1839(3)).

These measures can be evidenced by:

 Confidentiality agreement clauses that

require the recipient to maintain the

information’s confidentiality.

 Precautionary measures taken by the

trade secret owner to maintain the

information’s confidentiality within its own

organization.

Traditional confidentiality agreements

often use broader restrictive language

than that listed in the DTSA. As long as

the proscribed acts are encompassed by

the type of protection provided under the

DTSA, this broader agreement language

should meet the DTSA’s requirements. If

the parties seek greater protection beyond

that set out in the DTSA, the parties

should consider choosing a state’s law that

provides the best opportunity to pursue

additional claims for:

 Trade secret misappropriation claims

based on state law.

 Breach of contract.

The last alternative bracketed language

provides the most comprehensive

language addressing the disclosing party’s

confidentiality obligations.

DRAFTING NOTE: CONFIDENTIALITY OBLIGATIONS

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

8. Permitted Disclosures.

[Receiving Party may disclose Confidential Information to its employees with a bona fide

need to know such Confidential Information, but only to the extent necessary to carry out

the Business Purpose and only if such persons are advised of the confidential nature of such

Confidential Information and the terms of this Agreement and agree to be bound in writing by

theconfidentiality obligations contained in this Agreement.

Receiving Party may disclose Confidential Information to the following individuals to the extent

necessary to carry out the Business Purpose: [RECIPIENT NAMES]. Such disclosure may only

occur after the individuals are advised of the confidential nature of the Confidential Information

and the terms of this Agreement and agree to be bound in writing by the confidentiality

obligations contained in this Agreement. Receiving Party shall not disclose Confidential

Information to other individuals except upon the Disclosing Party’s prior written permission.]

Unlike many federal statutory schemes, the

DTSA expressly does not pre-empt state law

(18 U.S.C. §1838). There may be advantages

to pursuing claims under the DTSA or state

law and each party should consider which

state laws that may provide a favorable

option. State law includes both substantive

law, and state law that deals directly with

choice of law.

CHOICE OF LAW RULES

This provision includes optional bracketed

language that addresses the state’s

choice of law rules, which can determine

which state’s substantive law to apply. If

the parties do not include the bracketed

language, the forum court could apply the

choice of law rules of the selected state to

Typically, in addition to including a

paragraph addressing the receiving party’s

confidentiality obligations, confidentiality

agreements may also include a permitted

disclosure paragraph that identifies certain

situations where the receiving party may

be permitted to disclose confidential

information.

The first alternative clause allows disclosure

to advisors or other parties who both:

 Need access to the information so the

receiving party may perform the project

which is the basis of the disclosure.

 Agree to be bound by the same

confidentiality obligations set out in the

agreement.

The second alternative clause is more

restrictive and requires the receiving party

to limit disclosure to only those individuals

listed in the agreement. This is a practice

often employed in court-directed protective

orders.

DRAFTING NOTE: PERMITTED DISCLOSURES

DRAFTING NOTE: CHOICE OF LAW

9. Choice of Law. This Agreement and all related documents [including all exhibits attached

hereto][, and all matters arising out of or relating to this Agreement,] are governed by, and

construed in accordance with, the laws of the State of [STATE], United States of America

[(including [APPLICABLE STATE CHOICE OF LAW STATUTE(S)])] [, without regard to the conflict

of laws provisions thereof to the extent such principles or rules would require or permit the

application of the laws of any jurisdiction other than those of the State of [STATE]].

General Contract Clauses: Conﬁdentiality Agreement Clauses After the Defend Trade Secrets Act

10. Choice of Forum.

[Mandatory Choice of Forum. Each party irrevocably and unconditionally agrees that it will not

commence any action, litigation, or proceeding of any kind whatsoever against any other party in

any way arising from or relating to this Agreement and all contemplated transactions[, including,

but not limited to, contract, equity, tort, fraud, and statutory claims], in any forum other than [US

DISTRICT COURT NAME] or[, if such court does not have subject matter jurisdiction,] the courts

of the State of [STATE] sitting in [POLITICAL SUBDIVISION], and any appellate court from any

thereof. Each party irrevocably and unconditionally submits to the exclusive jurisdiction of such

courts and agrees to bring any such action, litigation, or proceeding only in [US DISTRICT COURT

NAME] or[, if such court does not have subject matter jurisdiction,] the courts of the State of

[STATE] sitting in [POLITICAL SUBDIVISION]. Each party agrees that a final judgment in any such

action, litigation or proceeding is conclusive and may be enforced in other jurisdictions by suit on

the judgment or in any other manner provided by law.

Permissive Choice of Forum. Any party may commence any action, litigation, or proceeding of

any kind whatsoever against any other party in any way arising from or relating to this Agreement

and all contemplated transactions[, including, but not limited to, contract, equity, tort, fraud,

and statutory claims], in [US DISTRICT COURT NAME] or[, if such court does not have subject

matter jurisdiction,] the courts of the State of [STATE] sitting in [POLITICAL SUBDIVISION], and

any appellate court from any thereof. Each party submits to the nonexclusive jurisdiction of such

courts and agrees that any such action, litigation, or proceeding may be brought in [US DISTRICT

COURT NAME] or[, if such court does not have subject matter jurisdiction,] the courts of the State

of [STATE] sitting in [POLITICAL SUBDIVISION]. Each party agrees that a final judgment in any

such action, litigation or proceeding is conclusive and may be enforced in other jurisdictions by

suit on the judgment or in any other manner provided by law.]

determine that the substantive law of a state

other than the selected state applies to the

transaction. For further discussion of choice

of law rules, see Standard Clauses, General

Contract Clauses: Choice of Law: Drafting

Notes: Choice of Law Rules(9-508-1609)

and Interaction with Other Contract

Provisions(9-508-1609).