https://www.businesswire.com/news/home/20200323005276/en/
There’s your conversion. Who’s on the board?
DALLAS–(BUSINESS WIRE)–The Trustees of Texas Pacific Land Trust (NYSE: TPL) (the “Trust”) announced today that the Trust has approved a plan to reorganize from its current structure to a corporation formed under Delaware law. The Trustees made their determination following careful consideration of the recommendation of the Conversion Exploration Committee of the Trust.
“The Trust’s present structure has suited the Trust’s needs and those of its shareholders for more than a century, but a Delaware corporate structure is more aligned with the expectations of today’s investors. A new corporate structure would better allow us to execute on business goals and capitalize on our enviable assets, resources and business potential,” said David E. Barry, a Trustee of the Trust. “With an enhanced governance framework in step with practices of publicly traded peer corporations, we expect a new corporate structure would enable value creation over time and drive value for stockholders.” John R. Norris III, Trustee of the Trust, added, “We are grateful to the members of the Committee for dedicating their time and attention to providing a thoughtful recommendation that informed this decision.”
Under the corporate reorganization plan, common stock of the new corporation would be distributed upon the consummation of the reorganization process to holders of sub-share certificates of proprietary interest of the Trust and traded on the New York Stock Exchange (NYSE). At or about such time, the sub-share certificates would be cancelled. The corporate reorganization is intended to be tax-free in the United States, and the corporation will be deemed a c-corporation for U.S. taxation purposes.
The Trust is presently aiming for the corporate reorganization to be effective by the end of the third quarter of 2020, but the Trust recognizes that unforeseen impacts of COVID-19 could extend this timeframe despite the Trust’s efforts. Barring any such unforeseen disruptions, further information regarding the corporate reorganization will be included in a registration statement on Form 10 to be filed by the corporation with the SEC as well as in other communications and disclosures anticipated to be made by the Trust and the corporation.
The Texas Pacific Land Trust Investor 
No governance guidance, but it’s a start.
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What does “an enhanced governance framework” mean exactly? The only yardstick offered is “in step with practices of publicly traded peer corporations”. The Form 10 will provide better clarity.
Now, while the PR doesn’t say much beyond the bare minimum, I still view this as a positive result given the back history.
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So what are the potential benefits of this? And does this mean the company’s old mission of buying back shares and going out of business is no longer valid?
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Wait a minute, the trustees took all this extra time to just approve the conversion, even though they were on the committee that recommended the approval? I expected more.
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This seemed relevant with Platts out today saying US shales is done for inside of 6m with hedges all rolling off for most producers. Meanwhile PXD’s CEO is calling for the end of shale (but somehow thinks he won’t be a victrim). https://www.youtube.com/watch?v=0er8btL4fpM
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Given that they have to file a Form 10 to complete their conversion, it will be subject to review and demand for changes by regulators. These reviews typically take a month or a month and half. Who knows how long it will take given the CV-19 situation. While I am no fan of the trustees, I imagine the timeline accounts for this new uncertainty.
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