Hugoton Royalty Trust Enters Material Definitive Agreement

TL;DR

Hugoton Royalty Trust signed a big deal on June 18th, filing an 8-K with settlement details.

AI Summary

On June 18, 2024, Hugoton Royalty Trust entered into a material definitive agreement related to a settlement. The filing also includes financial statements and exhibits. The company is incorporated in Texas and its principal executive offices are located in Dallas.

Why It Matters

This filing indicates a significant contractual development for Hugoton Royalty Trust, potentially impacting its financial operations and future agreements.

Risk Assessment

Risk Level: medium — Entering into a material definitive agreement can introduce new risks or resolve existing ones, requiring further analysis of the agreement's terms.

Key Players & Entities

• Hugoton Royalty Trust (company) — Registrant
• June 18, 2024 (date) — Date of earliest event reported
• Argent Trust Company (company) — Trustee
• Dallas, Texas (location) — Address of principal executive offices

FAQ

Key Financial Figures

• $18,105,467 — the benefit of XTO is stipulated to be $18,105,467; • that the value of the Overh
• $17,275,086 — enefit of the Trust is stipulated to be $17,275,086; • that the stipulated value o
• $830,381 — ing a balance, to the benefit of XTO of $830,381, which balance shall be treated as a pr
• $500,000 — rust a one-time advance distribution of $500,000, which shall be treated as a production
• $250,000 — does not leave the Trust with less than $250,000 of available cash. The Trustee curren

Filing Documents

• hgt_8-k_2406_xto_settlem.htm (8-K) — 49KB
• hgtxu-ex10_1.htm (EX-10.1) — 60KB
• 0000950170-24-076259.txt ( ) — 110KB

01. Entry into a Material Definitive Agreement

Item 1. 01. Entry into a Material Definitive Agreement. On June 18, 2024, Argent Trust Company, as trustee (the “Trustee”) of Hugoton Royalty Trust (the “Trust”) and XTO Energy, Inc. (“XTO”) entered into a Settlement Agreement (the “Settlement Agreement”) to resolve the pending arbitration between the Trust and XTO whereby the Trust (1) sought a declaratory judgment that XTO’s settlement in the Chieftain class action lawsuit is not a production cost and that XTO is prohibited from charging the settlement as a production cost under the Trust’s conveyance (the “Chieftain Claim”), and (2) disputing certain amounts relating to the computation of the Trust’s net proceeds for 2014 through 2019 and 2021 (the “Overhead Claims”). As previously disclosed, the arbitration panel in 2021 had ruled on the Chieftain Claim that a portion of the Chieftain settlement amount could be charged as a production cost. Pursuant to the Settlement Agreement, which Settlement Agreement is to be effective as of June 1, 2024 (the “Effective Date”), XTO and the Trustee agreed: • that the value of the Chieftain Claim with interest, to the benefit of XTO is stipulated to be $18,105,467; • that the value of the Overhead Claims, with interest, to the benefit of the Trust is stipulated to be $17,275,086; • that the stipulated value of Chieftain Claim and the Overhead Claims would be offset against one another, on a cumulative basis and without respect to which conveyance the particular claim arose, leaving a balance, to the benefit of XTO of $830,381, which balance shall be treated as a production cost under the Oklahoma conveyance, and subject to the recoupment and interest charges under that conveyance; and • that XTO will provide the Trust a one-time advance distribution of $500,000, which shall be treated as a production cost, except that it

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits. (d) Exhibits 10.1* Settlement Agreement dated June 18, 2024 to be effective as of June 1, 2024 by and between the Hugoton Royalty Trust and XTO Energy, Inc. Exhibit: 10.1: June 18, 2024 Settlement Agreement *filed herewith SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Hugoton Royalty Trust By: Argent Trust Company, Trustee Date: June 21, 2024 By: /s/ CHRIS HOLTZCLAW Chris Holtzclaw Chief Fiduciary Officer – West Region

View Full Filing

View this 8-K filing on SEC EDGAR