A- Nondisclosure Agreement
Businesses rely on NDAs to preserve confidentiality and maintain their competitive edge. Here’s what you should know about these legal agreements.
Nondisclosure agreements, or NDAs, protect confidential business information from being prematurely disclosed to the public or falling into the hands of competitors.
Whether used in employment contracts, business negotiations, or product development, NDAs establish clear boundaries for handling sensitive information and potential legal consequences for breaches.
1- What is a nondisclosure agreement (NDA)?
Also known as a confidential disclosure agreement, an NDA creates a confidential relationship between a person or business that has confidential or trade secret information and another person who has access to that information.
The NDA protects these business secrets by defining confidential information and limiting the way it can be used or disclosed.
A trade secret is any type of confidential and proprietary information that a business wants to keep private so it can enjoy an economic advantage over its competitors.
The term “trade secret” may sound high-tech and in fact, technology companies often deal in trade secrets—but trade secrets aren’t relegated to any one industry.
Trade secrets can take many forms:
Customer lists,
Expansion plans,
Information about new products or developments,
Details about pending litigation,
Data about a company’s clients,
2- What’s included in a nondisclosure agreement?
An NDA may be a stand-alone legal agreement or may exist in confidentiality clauses in another document, such as an employment agreement, an independent contractor agreement, or another contract that establishes a business relationship.
Standard-NDA or confidentiality agreement includes the following:
*) Parties involved; This section identifies two or more parties bound by the agreement, including the disclosing party (the one sharing confidential information) and the receiving party (the one agreeing to keep the information confidential).
*) Explanation of confidential information; This clearly defines what is considered confidential under the agreement, such as trade secrets or financial data.
*) Exclusions; This is a description of any information that is excluded from confidentiality. For example, confidential information may be disclosed if required for legal or accounting purposes. Likewise, information is usually not considered confidential if it has already been publicly released.
*) Obligations; This describes the receiving party’s obligations and acceptable uses of confidential information. In addition to keeping the information confidential, the receiving party may be required to destroy or return confidential information when the agreement ends.
*) Duration; Establishes the time period during which the agreement remains in effect. It may be a specific term (e.g., five years) or continue indefinitely until certain conditions are met (e.g., the information becomes public knowledge).
*) Miscellaneous terms; Like most contracts, an NDA may contain standard contract terms, including terms related to modifications, choice of law, choice of venue, arbitration, and attorney fees.
3- What happens if an NDA is breached?
It depends on the terms of the NDA. Breaching or violating an NDA is a serious offense and can result in several courses of action.
Here are some actions that can come from NDA violations:
*) Termination; The violating party can be terminated from their position.
*) Fines; They can be mandated to pay back what was lost due to their actions.
*) Court action; They may be the subject of a lawsuit.
4- What to do if you’re asked to sign an NDA form
During the course of your business or employment, it’s likely that you will be asked to sign a nondisclosure agreement.
Remember that nondisclosure agreements can be contained in other documents, so you should look for headings such as “Confidentiality,” “Confidential Information,” or “Nondisclosure.”
Also pay attention to the amount of time the NDA will remain in effect for, as some NDAs can remain in effect past the term of employment. Look for the information that is deemed confidential to ensure it’s not too vague or overreaching.
Finally, make sure what’s considered a breach of contract is included in the NDA.
5- How much does an NDA cost?
The cost of an NDA can vary significantly.
Simple, template-based NDAs may be free or cost under € 500.
Depending on complexity, custom NDAs drafted by lawyers often range from € 700 to € 1,000 or more.
Ongoing legal support for NDAs (such as enforcement or modifications) can also incur additional costs over time.
In addition, there are the costs of the advisors/brokers that have to be paid. If buyers move to close the deal, the costs will be credited toward the final fees. Our office fees for initiating the due diligence investigation amount to € 500 excluding VAT.
B- Due Diligence
After purchasers agree to and sign a non-disclosure agreement, the next step is to arrange due diligence if they wish to proceed with the purchase process.
1- What Is Due Diligence?
Due diligence refers to the thorough research and evaluation carried out to confirm the accuracy of information and assess any potential risks before committing to a transaction, agreement, or important decision.
In the financial world, due diligence requires an examination of financial records before entering into a proposed transaction with another party.
What is another word for due diligence?
Analysis, assessment, audit, examination, review, survey, verification, investigation.
Key Takeaways:
*) Due diligence is a systematic way to analyze and mitigate risk from a business or investment decision.
*) An individual investor can conduct due diligence on any stock using readily available public information.
*) The same due diligence strategy will work on many other types of investments.
*) Due diligence involves examining a company’s numbers, comparing the numbers over time, and benchmarking them against competitors.
*) Due diligence is applied in many other contexts, for example, conducting a background check on a potential employee or reading product reviews.
2- How to give due diligence?
Areas to target scrutiny in the due diligence checklist should include:
*) Historical Financial Statements.
*) Revenue and Expense Analysis.
*) Assets and Liabilities Review.
*) Taxation and Tax Compliance.
*) Debt and Financing Agreements.
*) Working Capital Analysis.
*) Financial Projections and Assumptions.
*) Cash Flow Analysis.
And what else do buyers want to investigate—-
3- Types of Due Diligence:
Depending on its purpose, due diligence takes different forms.
– Commercial due diligence considers a company’s market share and competitive positioning, including its future prospects and growth opportunities. This will consider the company’s supply chain from vendors to customers, market analysis, sales pipeline, and R&D pipeline. This can also encompass a firm’s overall operations, including management, human resources, and IT.
– Legal due diligence makes sure that a company has all of its legal, regulatory, and compliance eggs in a row. This includes everything from pending litigation to intellectual property rights to ensure the company was properly incorporated.
– Financial due diligence audits a company’s financial statements and books to make sure that there are no irregularities and that the company is on solid financial footing.
– Tax due diligence looks at the company’s tax exposure, whether it may owe any back taxes, and where it can reduce its tax burden going forward.
4- How long does it take for due diligence in Italy?
On average, it takes anywhere from several weeks to a few months to complete the due diligence process. What is a due diligence checklist?
5- Who pays for due diligence?
During this period, the buyer pays due diligence money a non-refundable fee equivalent to a certain percentage of the purchase to the research experts.
And (negotiable with the sellers) some down payment to the seller If both parties move to close the deal, that money is credited toward the purchase.
6- How much do you pay for due diligence in Italy?
There is typically customary pricing guidelines associated with how much due diligence money you should offer and “that’s dictated by the price point of the property
Buyers typically pay anywhere between 1.5% to 5% of the purchase price in due diligence money, depending on the agreements with the professionals and the seller.
In addition, there are the costs of the advisors/brokers that have to be paid. If buyers move to close the deal, the costs will be credited toward the final fees. Our office fees for initiating the due diligence investigation amount to € 5,000 excluding VAT
Please note that the above costs are separate from the one-off closing costs, such as notary fees, government taxes, advisor fees, etc. These are calculated by the accountant or notary during the process and included in the overview.
7- What happens after due diligence?
Once the due diligence period ends, the buyer cannot back out of the contract (except under a different, applicable contingency financing or appraisal, for instance). If they back out prior to closing and no other contingency gets them out of the contract, they lose their earnest money.
8- What happens if you don’t do due diligence?
If you don’t perform proper legal due diligence, you could be exposed to: unknown liabilities, such as lawsuits or outstanding debts; hidden contractual restrictions that impact business operations; the completeness of building permits and land registry registrations, etc.
9- Who can do due diligence research?
Due diligence can generally be performed by various parties involved in a transaction or decision-making process.
Professionals conducting due diligence on behalf of buyers or investors include lawyers, consultants, accountants, architects/ or surveyors, and sometimes in the case of agricultural acquisitions, an agronomist, winemaker, etc.
Should you require any further clarification, please don’t hesitate to contact us.
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Updated: 8 September, 2025
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