Therefore, the manager of an alternative investment fund (AIF) must provide investors with information about the AIF, such as. B conditions of the letter to investors, before making their investment. When changing the terms of a primary contract, it may be necessary to forward ancillary letters to third parties. For example, in lease agreements, concessions, such as a shorter lease term or consent to subletting, are often granted by the landlord to the tenant by means of a secondary letter. In our example, the potential buyer must be informed of the various concessions granted. Three situations regarding the use of side letters can be highlighted as an obstacle to their validity or effectiveness. Secondary letters, i.e. secret agreements, which aim to resolve or modify issues that a primary contract does not cover, have a bad reputation. The general validity of a secondary letter between the parties seems clear, regardless of the applicable system. It is then possible to determine the legal aspects of the side letters to avoid (Part I) and others that could be recommended (Part II). Third, by modifying the terms of the main contract, the subsidiary letter may change the characterization of the entire agreement.
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