Forming an LLC

Landman Discussion
1

I live in Ohio, and have Mineral Rights in Texas and Oklahoma.

I'm currently forming an LLC for these rights, with the purpose on preventing further dilution after my passing.

What is the most effective way of registering this LLC at the county records level and transferring the interests that are in my name? Also, these were inherited rights; there may be other rights that are still in the name of my grandfather or mother, in other County records. What can be done to best steer future searches to the new LLC. The name of the LLC includes my last name, so that should help. Any other suggestions?

thanks,

Roger

2

I think when you deed the mineral interests to the LLC you will show up on searches for owners in your minerals legal description. The LLC could probably also record some kind of statement of ownership just as an individual could, so you would be doubly covered.

3

Thanks RW. I'll get this to my Lawyer setting up the LLC. Appreciate the reply.

Roger

4

I have seen a few companies that own mineral and/or royalty interests file what's called an "Affidavit of Ownership" in the County Clerk's Office to put the public on notice that they are the owners of said interests, especially if the last deed of record was many years ago (say more than twenty years).

Make sure in the Mineral Deed to list each property by the appropriate legal description (survey, abstract number, block/range, etc.), that way the County Clerk and the local title companies will know with which of survey, for example, to "index" your mineral deed.

5

Pete, appreciate the insight. Very timely too; I am in the final stretch of validating the LLC.

Thanks,

Roger

6

I think that an Affidavit of Ownership in the name of the LLC would not be necessary if there were a Mineral Deed filed with the LLC as the Grantee, but it would not hurt anything. However, you might file what's called an Affidavit of Heirship for your grandfather, if he has passed away and his Will was not filed in Probate Court, and another Affidavit of Heirship for your mother, if she has passed away and her Will was not filed in Probate Court, to show how you came to own the mineral interests that they used to own. Each Affidavit of Heirship should include the entire marital history and list of heirs-at-law of the Decedent. Most attorneys would know how to fill out one of these, I would guess.

Then, after filing those Affidavits of Heirship, file the Mineral Deed conveying your mineral interests into the LLC. Make sure when you incorporate the LLC that you include in there the name of at least one other, preferably more than one other, member who you trust will carry out your wishes for the mineral interests.

7

Brian, Did you have to register your LLC as a foreign limited liability company in Texas and Oklahoma as well?