Rick,
I was perusing the internet *note: I am not an attorney, but someone did leave the light on for me once at a motel 6*
http://www.law.com/jsp/ihc/PubArticleIHC.jsp?id=1137578709925
Arizona is a "blue-pencil" state that allows certain portions of non-compete agreements to be struck while upholding others. They seem to take dim view of very broad agreements that block large geographical regions and those that are otherwise excessively restrictive to the severed employee finding gainful work.
Lawyer up buddy, but you will probably come out of this OK if you're careful.
angela