The Variation Agreement is essential in German commercial practice when parties need to modify an existing contractual arrangement while maintaining legal certainty. It's commonly used when business circumstances change, requiring adjustments to commercial terms, timelines, scope of services, or other contractual provisions. Under German law, while oral modifications are theoretically possible, written Variation Agreements are strongly preferred to ensure clarity and enforceability, especially when the original contract contains written form requirements. This document type is particularly important because German law emphasizes precise documentation of contractual modifications and requires clear delineation between original and modified terms.
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1. Parties: Identification of all parties to the original agreement and variation agreement
2. Background: Details of the original agreement being varied, including date and parties, and reasons for the variation
3. Definitions: Key terms used in the variation agreement, including reference to definitions in the original agreement
4. Original Agreement Reference: Clear identification and confirmation of the agreement being varied
5. Effective Date: Specification of when the variations take effect
6. Variations: Detailed description of all modifications to the original agreement
7. Confirmation of Other Terms: Confirmation that all other terms of the original agreement remain unchanged
8. Governing Law: Confirmation of German law as governing law
9. Execution: Signature blocks and execution provisions
1. Interpretation: Additional provisions on how the variation agreement should be read with the original agreement - include when there are complex modifications
2. Costs: Provisions regarding who bears the costs of preparing and implementing the variation - include when costs are significant or disputed
3. Third Party Rights: Provisions regarding the impact on any third party rights - include when third party interests are affected
4. Severability: Provisions for partial invalidity - include when variations are complex or high-risk
5. Entire Agreement: Confirmation this variation and original agreement constitute entire agreement - include when multiple previous variations exist
1. Schedule of Amendments: Detailed list of specific clauses being amended, showing original and new text
2. Revised Commercial Terms: Updated pricing, payment terms, or other commercial provisions if these are being varied
3. Markup of Original Agreement: Track-changed version showing all modifications to the original agreement
4. Required Authorizations: List of any required approvals or authorizations for the variations to take effect
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