This form is used when an Assignor assigns, transfers, and conveys to Assignee an overriding royalty interest in the Lease and all of the oil and gas produced, saved and marketed from the Lease, out of the interest owned by Assignor, with proportionate reduction (the Override ).
Illinois Assignment of Overriding Royalty Interest for Single Lease — Proportionate reduction is a legal document that pertains to the transfer of a specific portion of the royalty interest in an oil, gas, or mineral lease agreement in the state of Illinois. It involves the assignment of the overriding royalty interest from one party, known as the assignor, to another party, known as the assignee. This assignment is made in consideration of certain factors, such as the proportionate reduction of the royalty interest and the terms agreed upon by both parties. The purpose of an Illinois Assignment of Overriding Royalty Interest for Single Lease — Proportionate reduction is to enable the assignee to acquire a proportionate share of the ongoing royalty income that the assignor is entitled to under the lease agreement. This transfer allows the assignee to benefit from the production and exploitation of oil, gas, or minerals on the leased property. There may be different types of Illinois Assignment of Overriding Royalty Interest for Single Lease — Proportionate reduction, depending on the specific terms negotiated between the assignor and assignee. These types may include: 1. Fixed Proportionate Reduction Assignment: In this type, a fixed percentage or fraction of the assignable royalty interest is transferred to the assignee. This percentage remains constant throughout the term of the lease agreement, enabling the assignee to benefit from a predictable share of the income generated. 2. Variable Proportionate Reduction Assignment: Unlike a fixed proportionate reduction assignment, this type allows for the variation of the assigned royalty interest percentage over time. The assignment may include provisions that adjust the proportionate reduction based on factors such as production levels, market conditions, or other specified criteria. 3. Partial Proportionate Reduction Assignment: This type involves the transfer of only a portion of the assignor's overriding royalty interest in the lease agreement. The assignor retains ownership of the remaining portion, allowing them to continue earning royalties alongside the assignee. Regardless of the specific type, an Illinois Assignment of Overriding Royalty Interest for Single Lease — Proportionate reduction is a legally binding document that requires the agreement of both parties involved. It sets out the rights and obligations of each party, including any additional terms and conditions regarding the assignment. It is essential for all parties to carefully review and understand the terms of the assignment before signing to ensure a fair and equitable transfer of the overriding royalty interest.
