Caution should be exercised when including return provisions in the JSBA. Some model agreements, such as the appointing authority`s Model Study and Submission Agreement Form (2006), provide that a party may withdraw from the agreement, with the withdrawing party being required not to enter into participation in a concession extending to all or part of the territory that the consortium has envisaged for a period of one year after withdrawal. In most cases, it would be preferable to extend this obligation in order to prohibit the withdrawing party from applying in the relevant licence cycle for the reasons set out in point 4. This Agreement (this «Agreement») confirms and sets forth, among other things, the terms of any agreement between the parties in connection with their proposal to implement a Joint Placement (the «Joint Offering», the key terms of which will be included in the Joint Offer Documentation) for the entire issued and issued share capital of the Target Company. The JSBA, in its simplest form, is a short-term non-legal joint venture agreement whose purpose is to regulate the relationships of the parties prior to the granting of the license/concession. The JSBA usually ensures the rapid execution of an JOA once a PSC has been approved by the government. In order to save time in negotiating an OJA, the parties may agree and establish certain key principles under the JSBA, and they may also agree that those principles govern joint actions on a temporary basis until a full JOA is completed. However, the parties must be careful to rely on the JOA Principles for a longer period of time, as the key principles agreed between the parties will not do so The content of a JSBA is still a product of the time that was available prior to the submission of the licence application (which, in the case of the UKCS, is generally 90 days after the start of the licence cycle). The JSBA is usually designed with an early finish line in mind – the license. Instead, the parties to the JSBA should agree in sufficient detail that they can be used to operate the joint venture between the consortium members until the JOA is agreed.
This practical note provides an introduction to inter-creditor agreements and their main provisions. This practice note:•explains the purpose of an inter-creditor agreement and when an inter-creditor agreement would be used instead of a priority deed or certificate of subordination•contains links to Are you and another contractor joining forces and submitting a bid for a joint project as a general contractor? You can use a joint tender agreement to put this partnership in writing. It is a legal document completed by two or more contractors who jointly propose a specific construction project. A joint bidding agreement can be useful for a contractor who specializes in a skill set and wants to work with another specialist to complete a project. Are you and another entrepreneur about to join forces and offer a joint project as a general contractor? You can use a joint tender agreement to put this partnership in writing. It is a legal issue. Read More In some cases, consortium members may not be able to unanimously agree on the block(s) they wish to apply for together and on the terms of the proposed licence application. In such a case, it is customary for the JSBA to provide for a procedure that leads to the submission of a proposal, but in which parties who do not support such a proposal may decide not to participate. If fewer of all parties participate, the participations in the proposal will have to be recalculated and each participating party will generally be awarded a larger participation than it had initially envisaged when joining the JSBA, unless third parties are included in the application instead of the non-consenting parties (see above) in order to avoid: that the other parties increase their respective shares. Parties to the JSBA should recognize that it is possible for them to complete the bidding process with greater participation than originally.
A party wishing to avoid such a situation must carefully observe the recalculation formula and must negotiate the JSBA to protect itself from it. In addition, the parties should be aware that there may already be agreements on areas of mutual interest («AMIA») that bind potential consortium members. The impact of these existing agreements on the composition of the proposed consortium needs to be carefully assessed. In analyzing the above considerations, it is clear that the importance of the content and purpose of the JSBA should not be underestimated. As is common in many situations in the oil and gas industry where contractual arrangements need to be recalled, there are model forms of JSBA that make a reasonable but incomplete attempt to resolve key issues and, in some respects, do not address the nuances of ukcs, in the absence of important desirable provisions. To support a successful joint application and subsequent joint venture in the UKCS, there is no real substitute for a tailor-made JSBA and timely preparation in advance. Before starting negotiations on the JSBA, the parties must assess what they each offer the consortium (and also what they expect from the others). Without exception, these conversations involve the disclosure of commercially sensitive information, so the parties must enter into a confidentiality agreement prior to incoming discussions. A given party can bring much more value to the consortium than the others if it is in exclusive possession of certain high-quality information. In order to be able to disclose this information to the consortium, the consortium may seek a higher level of comfort in maintaining its confidentiality than is usual in a standard confidentiality agreement, for example by requiring certain compensation from the parties.
Parties should therefore assume that there may be a discussion during the negotiation of the confidentiality agreement, and parties who need to disclose less (or not) confidential information will therefore care less about the confidentiality aspects of their relationship. The Joint Study and Offer Agreement (JSBA) is a common contractual arrangement in the international oil and gas industry in which several parties wish to jointly review a specific license area in order to finally submit a joint offer for the license/concession outside of a registered joint venture. For more information on licenses/concessions, see Practical note: Understanding upstream oil agreements – concessions, production sharing contracts and service contracts. This Joint Tender Agreement (this «Agreement») dated June 29, 2007 by and between AT&T Inc. («AT&T») and Dobson Communications Corporation («Dobson») sets out the procedures by which AT&T and Dobson will jointly bid on the 700 MHz spectrum auction required by law by the Federal Communications Commission (the «Commission» or the «FCC») no later than January 28. 2008 (the «Auction»). Conceptually, the JSBA as a precursor to the JOA is a short-term agreement that must be active in the period between the license and the conclusion of the JOA. However, it is not uncommon for negotiations on the OJA to take a long time and be subject to protracted disputes, especially when the parties come from different jurisdictions and have different experiences in dealing with the British continental shelf («UKCS»).
A lengthy JOA negotiation will result in an extension of the duration of the consortium`s dependence on JSBA as the management vehicle for its joint venture. This can be alarming for the consortium if the JSBA does not foresee this possibility. .