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A joint operating agreement is a legal document that outlines the relationship between two or more businesses who jointly operate a business. When one company partners with another, they are typically signing this type of contract to ensure their business interests are protected.
Joint Operating Agreements ("JOAs") are often used in capital-intensive resource industries by parties who wish to re- strict their exposure, particularly in limiting costs or liability.
A Joint Venture (JV) is the name given to a business formed by different companies that come together for a particular business. These parties enter into a Joint Operating Agreement (JOA) that binds them together. A JV is established for a specific purpose.
1. n. [Oil and Gas Business] The right that nonselling participating parties have in a lease, well or unit to proportionately acquire the interest that a participating party proposes to sell to a third party.
In the health care industry, hospitals may form a JOA to provide a stronger financial structure. The JOA, also known in this industry as a virtual merger, allows the hospitals to retain separate boards of directors but turns over management to a separate company.
A joint operating agreement is a legal document that outlines the relationship between two or more businesses who jointly operate a business. When one company partners with another, they are typically signing this type of contract to ensure their business interests are protected.
An area of mutual interest (AMI) contract describes the geographic area contained in the AMI, the rights of each party (such as the percentage interest allocated to each company), the agreement's term, and how contract provisions are to be implemented.
Joint operating agreements are contractual agreements between one party identified as the operator and at least one other party known as a non-operator which requires the operator to drill the initial obligatory well, and the non-operator to pay its proportionate share of the operating expenses.