Lord Reg sitting on the cross-fench?

Following on from the earlier post about the future of the Conservative Party in Northern Ireland:

DUP Assembly Member Paul Givan has said that Reg Empey’s announcement concerning his status as a Tory peer provides further evidence of UUP in-fighting. For some days there has been speculation that East Belfast UUP members have been demanding that their former leader be removed as an Assembly candidate on the grounds that he cannot be a UUP candidate in the Assembly election whilst sitting as a Tory peer in the House of Lords.

I did contact someone in the DUP for some confirmation on this as I couldn't find anything online. I haven't had a reply yet but basically theur allegation is that Sir Reg Empey will not now be sitting as a Tory Peer in the House of Lords, he'll be moving to the cross-benches instead to facilitate his candidature as a UUPer at the Assembly Elections.

As I said, I can find no direct confirmation of this (the Tele reports on Thursday that he joined last week's debate as a Conservative) but if true what does this tell us about the true nature of the arrangement between the UK Conservatives and the UUP?