We just received this Top-Lease;
A. Lease Bonus of $750 per net mineral acre with 20% up front and the other 80% due within 30 days of vesting (should it vest).
B. 3/16 Royalty
C. 3 year term - term commencing on the expiration date of the “existing lease”
Said Top-Lease is to be paid with the initial 20% payment sent to Lesor, and the second payment is due within thirty days of the Top Lease vesting, provided said date is prior to June 22, 2011 (which is the date of the original lease). Should the “existing lease” be extended beyond June 22, 2011, the second payment is not due and the top lease will not take effect.
As I understand this, we will get this bonus and they will get an extension of 3 more years beyond 6/22/2011.…. With no more lease money??? What does “should it vest” mean? Would we be better off just waiting to re lease again when this existing lease expires. Altho, I suppose if they put a well in with this old lease, then they don’t have to lease anymore.