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 ).
Maryland Assignment of Overriding Royalty Interest for Single Lease — Proportionate Reduction is an important legal document used in the oil and gas industry. It plays a crucial role in the assignment of overriding royalty interests (ORRIS) for a single lease in the state of Maryland. When oil and gas companies enter into a lease agreement, they often grant overriding royalty interests to third parties. These interests entitle the holders to a portion of the revenue generated from the production of oil and gas from the leased property. However, circumstances may arise where it becomes necessary to reduce the proportionate share of the ORRIS. The Maryland Assignment of Overriding Royalty Interest for Single Lease — Proportionate Reduction allows for the assignment and transfer of the ORRIS to another party, while also specifying a reduction in the proportionate share. This document ensures that the original assignee receives a reduced percentage of the overriding royalty interest, while the newly assigned party assumes the remaining share. There may be different types of Maryland Assignment of Overriding Royalty Interest for Single Lease — Proportionate Reduction, each tailored to specific situations. Some common types include: 1. Transfer of ORRIS with Proportionate Reduction to a New Party: This type of assignment occurs when the original assignee wishes to transfer their ORRIS to a new party while simultaneously reducing their proportionate share. Usually, this happens when the original assignee wants to divest their interest or when a third party purchases the interest from them. 2. Assignment of ORRIS with Proportionate Reduction to Multiple Parties: In cases where the ORRIS is assigned to multiple parties, this type of document ensures that each assignee's proportionate share is reduced accordingly. This helps maintain fairness and equitable distribution of the ORRIS among the assignees. 3. ORRIS Proportionate Reduction due to Changes in Lease Conditions: When the terms and conditions of the lease change, and it becomes necessary to reduce the ORRIS proportionately, this type of Maryland Assignment comes into play. It establishes the new proportionate share of each assignee based on the altered lease conditions. In conclusion, the Maryland Assignment of Overriding Royalty Interest for Single Lease — Proportionate Reduction is a crucial legal document that facilitates the transfer of ORRIS while ensuring a fair and proportionate reduction among the involved parties. It provides a clear framework for assigning and reducing overriding royalty interests in Maryland for single leases.
