Replies to post #20003 on Mesa Offshore Trust (fka MOSH)

[ican70]

Laddie you asked a question earlier- from the 10K-03/31/2008

Description of units

Liability of Unitholders

As regards to the unitholders, the Trustee is fully liable if the Trustee incurs any liability without ensuring that such liability will be satisfiable only out of the Trust assets (regardless of whether the assets are adequate to satisfy the liability) and in no event out of amounts distributed to, or other assets owned by unitholders. However, under Texas law, it is unclear whether a unitholder would be jointly and severally liable for any liability of the Trust in the event that all of the following conditions were to occur: (1) the satisfaction of such liability was not by contract limited to the assets of the Trust; (2) the assets of the Trust were insufficient to discharge such liability; and (3) the assets of the Trustee were insufficient to discharge such liability. Although each unitholder should weigh this potential exposure in deciding whether to retain or transfer his units, the Trustee is of the opinion that because of the passive nature of the Trust assets, the restrictions on the power of the Trustee to incur liabilities and the required financial net worth of any trustee, the imposition of any liability on a unitholder is extremely unlikely.

The limited liability of the Trust unitholders is uncertain.

The Trust unitholders are not protected from the liabilities of the Trust to the same extent that a shareholder would be protected from a corporation's liabilities. The structure of the Trust does not include the interposition of a limited liability entity such as a corporation or a limited partnership which would provide further limited liability protection to Trust unitholders. While the Trustee is liable for any excess liabilities incurred if the Trustee fails to insure that such liabilities of the Trust are to be satisfied only out of Trust assets, under the laws of Texas, which are unsettled on this point, a holder of units may be jointly and severally liable for any liability of the Trust if the satisfaction of such liability was not contractually limited to the assets of the Trust and the assets of the Trust and the Trustee are not adequate to satisfy such liability. As a result, Trust unitholders may be exposed to personal liability.

In my opinion based upon what is said above, the probability and chances of us unitholders being responsible for any fees... is slim. It is unclear under Texas Law, and I am thinking say if the trustee entered a contract that was not contractually limited to the assets of the Trust, this would be a material event for which there should have been disclosure in the form of an SEC filing. Off hand I cannot remember seeing such a filing. If there has been one, someone please correct me.

This is just my opinion and please contact your CPA for further guidance.

I wish everyone all the best and may we Mosh Unitholders be victorious by settlement or in trial. Hope everyone had a good Easter.

ican