How to vet a company offering to lease?

Hi, I’m new! Wondering if there is a good way to vet a company that writes with a lease offer. Wish they had Yelp reviews. :slight_smile: Any suggestions appreciated.

Holly,

What’s the name of the Company? Some of the Forum Members may have had contact with them and can share their thoughts, etc.

Clint Liles

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Thanks for the reply. It was a general question; no specific offer at the moment, but I’ll ask next time we receive. Thanks again.

Talk with other mineral owners in your local area and on this forum. Ideally most good operators in your area should be well-known, and you won’t have a whole lot of guesswork to do.

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Use extreme caution even when dealing with an established company.

Beware of Delivering Lease Without Payment:

Failure of a company to pay a lease bonus is a theme that has been raised in this forum far to often. Below are a few discussions on the topic. It is always best to exchange a lease for a check at the time of the transaction. This may not always be possible because of distance. In such cases it is probably better to have an escrow company or attorney to hold the lease until the consideration is paid.

Sometimes companies file leases without payment of bonuses.

There have been cases were companies take leases but never file them. They return the leases later stating that they were never funded by the company. In the meantime, the mineral owner cannot sign with another company.

It is much easier to prevent the issue than to remedy it after the fact.

Below is a sample of Nightmares:

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Thank you Richard, this is incredibly informative- and scary! I appreciate the examples and will study them this weekend. Thanks again!

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www.corporationwiki.com is a helpful research site. Respecting Richard Winblad’s excellent post, please consider the following.

Accepting Drafts in Payment for Lease Bonus – A Ticking Time Bomb?

By John McFarland

“…First, a draft is not a check (although it may look like one)…”

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