1. Parties: This agreement is between you, the “seller”, and Texas Royalty Brokers LLC, the “broker”. Texas Royalty Brokers also works with mineral buyers, the “buyers”, who are not a party to the agreement but are referred to throughout the agreement.
2. Legal Authority: You have the authority as an individual, trustee, power of attorney, or other legal entity to enter into this agreement. You further agree that you have the legal authority to sell the mineral rights or mineral interest being listing with our company.
3. Legal Advice: You understand and acknowledge that Texas Royalty Brokers does not provide legal advice. Any guidance we provide is simply our opinion and we recommend legal counsel to review all documentation including purchase and sale agreements, mineral deeds, and other legal instruments. It is your sole responsibility to understand any legal document you sign.
4. Tax Advice: You understand and acknowledge that Texas Royalty Brokers does not provide tax advice. Any guidance we provide is simply our opinion and we recommend a qualified tax professional to review your individual tax situation.
5. Wire Transfers: You agree that it is your sole responsibility to provide accurate wire transfer details to Texas Royalty Brokers. It is your responsibility to send accurate wire transfer details to Texas Royalty Brokers, which includes ensuring that no 3rd party can access your email and send us incorrect wire transfer instructions via email.
6. Future Inheritance: You understand and agree that when you sell any mineral interests, you may also be selling mineral rights you don’t own yet that may be inherited in the future as part of the sale. If there is any chance you could inherit additional mineral rights in the future in the same county where you are selling mineral rights, we advise seeking legal counsel.
7. Public Information Disclosure: You agree that any information provided to Texas Royalty Brokers in any manner will be publicly available on our website. It is your sole responsibility to redact any information found on documentation you provide to us that you do not want to be publicly available.
8. Estimations and Closing Adjustments: You understand and agree that Texas Royalty Brokers will market your mineral interests based on an estimate of what you own unless title is provided. The amount you are paid at closing is determined by the legal agreement between yourself and the mineral buyer. This means the amount you are paid at closing could be adjusted higher or lower based upon what is proven in title compared to any estimate of your ownership.
9. Indemnification: You agree to indemnify and hold harmless Texas Royalty Brokers from any and all demands, claims, lawsuits, arbitrations, market losses, or liabilities of any kind, which includes any costs, fees, expenses, or attorney’s fees as a result of selling, attempting to sell, or listing mineral interests with our company. This indemnification includes, but is not limited to, any losses you sustain as a result of our legal opinions, our tax opinions, an existing offer expiring or changing after listing with our company, any loss resulting from your information being provided publicly, any closing adjustments based on our estimate of what you own, any future inherited mineral rights being sold as part of a sale we broker, any material disclosures you failed to provide us, or incorrect wire transfer details being provided to our company.
10. Securities: You agree that the mineral interests you are selling are not considered securities or fractionalized interests.
11. Exclusive Agreement: You agree to grant Texas Royalty Brokers the exclusive right to market your mineral interests for the agreement term, subject to the provisions of the referral period. Any buyer who contacts you during the agreement term or during the referral period should be promptly directed to Texas Royalty Brokers.
12. Agreement Term: This agreement gives Texas Royalty Brokers a period of 30 calendar days to market your mineral interests. The agreement term begins the day your listing is posted live to our website and the confirmation email is sent to you. The agreement term renews automatically for an additional 30 days until cancelled in writing prior to the end of the current 30 day term. To cancel, email firstname.lastname@example.org
13. Referral Period: Any sale, transfer, conveyance of mineral interests, or entering into any contract to sell, transfer, or convey mineral interests within 45 business days following the last day of the most recent 30 day agreement term requires that a commission be paid. This prevents you from listing for 30 days and then turning around and selling the mineral interest immediately after getting exposure to thousands of mineral buyers while avoiding our commission. If you sell, transfer, convey, or enter into a contract to sell, transfer, or convey the mineral rights to any entity in the 45 business days following the agreement term, you are personally liable to pay us our commission based on the amount you received, the listing price, or the highest legitimate offer we found for you, whichever is greater.
14. Commission: Once you have signed a purchase and sale agreement with a mineral buyer, you understand and agree that Texas Royalty Brokers is paid a commission based on the total sales price. The mineral buyer will pay our commission at closing based upon the following scale:
First $2,500,000: 5%
$2,500,000 to $5,000,000: 4%
Example: If the sale price is $3,000,000, the commission would be: ($2,500,000 X 5% = $125,000) + ($500,0000 x 4% = $20,000) = $145,000
Our commission is based upon the total sales price, after any adjustments to purchase price based upon the amount of ownership confirmed in title. However, any adjustments related to taxes, royalty income received prior to closing due to buyer, or any other expenses specific to the Seller do not reduce the commission due to Texas Royalty Brokers and only reduce the amount due to Seller.
15. Circumvention: You understand and agree that if you sell, transfer, or convey mineral interests, or enter into any contracts to sell, transfer, or convey mineral interests during the agreement term or during the referral period to any entity while not working directly with Texas Royalty Brokers, and that entity does not pay our commission, you are now personally liable to pay our commission from the total sales price. Once you receive email notification from Texas Royalty Brokers that you have circumvented and owe the commission personally, you have 10 calendar days to provide proof of the total sales price and make the payment via wire transfer. If proof of the total sales price is not provided or the commission is not paid within 10 calendar days, you understand and agree that Texas Royalty Brokers is entitled to file a lawsuit to collect the commission due, our legal expenses, any marketing expenses directly related to your sale, and that interest will accrue at 20% APR compounding monthly starting 10 calendar days after notification. You further understand and agree that Texas Royalty Brokers is entitled to place a lien on any real or personal property you may own until the commission has been collected.
16. Forced Sale: You are under no obligation to accept any offer received after listing. Texas Royalty Brokers does not force a sale even if there are offers above your listing price.
17. Purchase and Sale Agreement: While we do not force a sale, once you have signed a purchase sale agreement or any intent to sell agreement with a buyer, you are required to follow through with the terms of the agreement. If you sign a purchase and sale agreement and then decide not to sell or do not follow the terms of the purchase and sale agreement, you are required to pay Texas Royalty Brokers a commission based on the agreed upon price in the contract for damaging our reputation with buyers. If payment is not made within 10 calendar days of the purchase and sale agreement expiring, it is considered circumvention, and the terms of circumvention apply.
18. Deposits: Any deposit that a buyer makes shall be held by Texas Royalty Brokers. If the buyer forfeits their deposit, that deposit shall be split 50/50 between Seller and Texas Royalty Brokers.
19. Effective Date & Royalty Income: You understand and agree that any royalty income you receive after the effective date of the agreement you sign is due to the buyer, and you further agree to remit payment to the buyer for any funds you receive that should have been paid to the buyer. The effective date should be assumed to be based on production month, unless the purchase and sale agreement you sign with the buyer states something different.
20. Property Taxes / Ad Valorem Taxes: You understand and agree that you are responsible for paying your proportionate share of the property taxes that may become due after the sale occurs.
21. Partial Sales: If you sell a portion of your ownership through Texas Royalty Brokers, and then subsequently sell more of your mineral rights to the same buyer or any buyer affiliated with that buyer within 6 months of closing the initial transaction, Texas Royalty Brokers shall be due a commission based upon the amount you receive from subsequent sales.
22. Existing Offers: If you have an existing offer to sell mineral interests, no commission is owed to Texas Royalty Brokers if you accept the existing offer even though we have the exclusive right to market your mineral interests under the following conditions:
A. The offer is provided in writing (email, physical letter, etc) and Texas Mineral Brokers has verified it is a legitimate offer at their sole discretion via email prior to listing; and
B. The offer has a specific company name listed, and the conveyance document specifies exactly that company name; and
C. You sell at exactly the price provided in writing. If the price is increased for any reason after listing, during the listing term, or during the referral period, Texas Mineral Brokers is entitled to collect a commission on the total amount of the offer, not just the amount they increased the offer over the original offer. However, our commission cannot cause you to get less than the original amount they offered.
D. If you sell a portion of your mineral rights, the terms here apply proportionately. For example, if you sell 50% of your mineral rights and the implied price of selling 100% is higher, you would still owe a commission for selling 50% even though the price is lower because the overall value is higher.
23. Closing: Unless buyer and seller mutually agree to use a third-party escrow at their expense, closing shall occur in the steps defined below:
A. The buyer will create and provide a mineral deed for closing. This deed will be provided to the seller. In addition, Texas Royalty Brokers will send the seller a wire transfer confirmation form.
B. Seller will sign and notarize two (2) copies of the mineral deed. Seller will fill out and sign the wire transfer details form. Both signed original copies of the mineral deed and the signed wire transfer details form will be sent to Texas Royalty Brokers.
C. Texas Royalty Brokers will hold the mineral deeds until the buyer sends a wire transfer to both the seller and Texas Mineral Brokers. Once the seller and Texas Mineral Brokers have received their respective funds from the sale, Texas Mineral Brokers will overnight the mineral deed to the buyer.
III. Material Disclosures
24. Material Disclosures: You understand and agree that certain information can materially affect the value or marketability of your mineral interests. You further understand and agree that you have an obligation to notify Texas Royalty Brokers in writing about this information which includes:
A. Any past due taxes whether at the county level, state level, or federal level
B. Any loans or mortgages against the mineral interests
C. Any reason why the documentation you provided would not be accurate or complete
D. Any liens, judgements, or encumbrances on the mineral interests
E. Any current or potential lawsuits
F. Any money held in suspense or released from suspense within the last 90 days or while listed
G. Any bankruptcy proceedings or claims
H. Any reason to believe that the check stubs provided show a different amount than what you actually received
I. Any royalty checks that were voided in the last 12 months
J. Any other mineral interests you have in the same county that you are not intending to list / sell with Texas Royalty Brokers
K. Any possibility that you could inherit mineral rights in the same location as the mineral rights you are listing and/or selling through our company
L. Any possibility that you own mineral rights in the same location as the mineral rights you are listing and/or selling, but held under a different name, entity, or ownership number that is not reflected on the documentation provided
M. Any remainderman who may have a claim to your mineral rights after your pass away
IV. Contract Terms
25. Severability: If any provision or part of this agreement is found to be invalid or unenforceable, only that particular provision or part shall be unenforceable, and not the entire agreement.
26. Dispute Resolution: Any dispute between the parties regarding the terms of this agreement shall be governed by the substantive law of the State of Texas. Both parties irrevocably agree that any suit, action, claim, arbitration, or proceeding of any kind arising out of or related to this agreement shall be exclusively handled by any court located in Harris County, Texas.
27. Electronic Agreement: If this agreement is being signed online, you understand and agree that you are agreeing with a digital signature and that all terms are binding and have the same force and effect as physically signing.
28. Offered Agreement: Unless this agreement is in physical form and revisions have been made and initialed by the seller, it is understood and agreed that Texas Royalty Brokers LLC has agreed to all terms in our agreement expressly and does not need to counter sign for this agreement to be valid.
Last Update: 5/10/2023