Nearly all of the licensees in the UKCS are Contracting Parties to the Master Deed, therefore it is unlikely that you will have to serve a pre-emption notice as a Disposing Participant on a non-Contracting Party. In the unlikely event that this happens, the provisions contained within the JOA will continue to apply only to that affected Non-Contracting Party. This will include any increased time periods that they have to exercise their pre-emption rights.
New Transfer Arrangements
It goes without saying that Non-Contracting Parties are not bound by the terms of the New Transfer Arrangements and, as such, you may have to discuss the benefits of using this process as opposed to the more traditional novation process.
It is recognised that the pro-forma Execution Deed does not provide for inclusion of Non-Contracting Parties, therefore a number of amendments need to be made:
- You will need to amend the Notice of Transfer to state the companies that are not receiving it, for the sake of clarity;
- You should start by designing the Non-Contracting Party[ies] in the designation section and define as the “Non-Contracting Party” of the “Non-Contracting Parties” as appropriate;
- At the designation for the Administrator, insert the words “other than the Non-Contracting Party[ies]” immediately following the words “Remaining Participants”;
- In paragraph 1 (9) line 2, the words “and where applicable, the Non-Contracting Parties” are inserted after the words “Contracting Parties”;
- In paragraph 5(1)(e), the words “Contracting Parties” are replaced with “Remaining Participants”;
- In paragraph 14 line 2, the phrase “(other than the Non-Contracting Parties)” shall be added after “Remaining Participants”;
- In paragraph 15 line 5, the phrase “Non-Contracting Parties, the” shall be added after “by or on behalf of the”;
- In paragraph 16 line 2, the phrase “the Non-Contracting Parties,” shall be added after “each of the Administrator,”; and
- You will need to insert a new paragraph 18 stating “The execution and delivery of this Deed by the Non-Contracting Parties is made in each of their capacities as a Remaining Participant and is required as the Non-Contracting Parties are not party to the Master Deed.