What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2024-03-20 compared with 2023-03-16 · 29 added, 33 removed, 261 unchanged (19% of the section changed)

30 unchanged sentences

March 20, 2024

TABLE OF CONTENTS

STATEMENTS OF ASSETS AND TRUST CORPUS

4 unchanged sentences

(46,191,522 )

Trust corpus, 11,500,000 Trust units issued and outstanding at December 31,

2021 and 2022

Trust corpus, 11,500,000 Trust Units issued and outstanding at December 31, 2022 and 2023

STATEMENTS OF DISTRIBUTABLE INCOME

14 unchanged sentences

(25,530,000 )

(16,790,000 )

Trust expenses

1 unchanged sentence

Trust corpus, end of year

The accompanying notes are an integral part of these financial statements.

TABLE OF CONTENTS

NOTES TO FINANCIAL STATEMENTS

NOTE A — ORGANIZATION OF THE TRUST

MV Oil Trust (the “Trust”) is a statutory trust formed on August 3, 2006, under the Delaware Statutory Trust Act pursuant to a Trust Agreement (the “Trust Agreement”) among MV Partners, LLC (“MV Partners”), as trustor, The Bank of New York Mellon Trust Company, N.A., as Trustee (the “Trustee”), and Wilmington Trust Company, as Delaware Trustee (the “Delaware Trustee”).

The Trust was created to acquire and hold a term net profits interest for the benefit of the Trust unitholders pursuant to a conveyance from MV Partners to the Trust.

MV Oil Trust (the “Trust”) is a statutory trust formed on August 3, 2006, under the Delaware Statutory Trust Act pursuant to a Trust Agreement (as amended and restated, the “Trust Agreement”) among MV Partners, LLC (“MV Partners”), as trustor, The Bank of New York Mellon Trust Company, N.A., as Trustee (the “Trustee”), and Wilmington Trust Company, as Delaware Trustee (the “Delaware Trustee”).

The Trust was created to acquire and hold a term net profits interest for the benefit of the Trust unitholders pursuant to the Conveyance of Net Profits Interest dated as of January 24, 2007 from MV Partners to the Trust (the “Conveyance”).

The term net profits interest is an interest in underlying properties consisting of MV Partners’ net interests in all of its oil and natural gas properties located in the Mid-Continent region in the states of Kansas and Colorado (the “underlying properties”).

7 unchanged sentences

annual cash proceeds received by the Trust attributable to the net profits interest are less than $1.0 million for each of two consecutive years;

the holders of a majority of the outstanding trust units vote in favor of dissolution;

the holders of a majority of the outstanding units of beneficial interest in the Trust (“Trust Units”) vote in favor of dissolution;

there is a judicial dissolution of the Trust.

7 unchanged sentences

The Trust uses the modified cash basis of accounting to report receipts by the Trust of the net profits interest and payments of expenses incurred.

The net profits interest represents the right to receive revenues (oil, gas and natural gas liquid sales) less direct operating expenses (lease operating, maintenance and overhead expenses and production and property taxes) and an adjustment for lease equipment cost and lease development expenses (which are capitalized in financial statements prepared in accordance with accounting

principles generally accepted in the United States of America (“U.S.

The net profits interest represents the right to receive revenues (oil, gas and natural gas liquid sales) less direct operating expenses (lease operating, maintenance and overhead

expenses and production and property taxes) and an adjustment for lease equipment cost and lease development expenses (which are capitalized in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

GAAP”)) of the underlying properties times 80% (term net profits interest percentage).

34 unchanged sentences

Income from net profits interest (3)

Pursuant to the conveyance of the net profits interest, direct operating expenses, lease equipment and development costs are deducted when calculating the distributable income to the Trust.

Pursuant to the conveyance of the net profits interest, MV Partners can reserve up to $1,000,000 for future exploration, development, maintenance or operating expenditures at any time.

Pursuant to the Conveyance, direct operating expenses, lease equipment and development costs are deducted when calculating the distributable income to the Trust.

Pursuant to the Conveyance, MV Partners can reserve up to $1,000,000 for future exploration, development, maintenance or operating expenditures at any time.

The reserve balance was $1,000,000 at December 31, 2021, 2022 and 2023, respectively.

2 unchanged sentences

thus, the cash received by the Trust during the year ended December 31, 2021 substantially represents the production by MV Partners from September 2020 through August 2021 and the cash received by the Trust during the year ended December 31, 2022 substantially represents the production by MV Partners from September 2021 through August 2022 and the cash received by the Trust during the year ended December 31, 2023 substantially represents the production by MV Partners from September 2022 through August 2023.

For the years ended December 31, 2020, 2021 and 2022, MV Purchasing, LLC, which we refer to herein as “MV Purchasing,” purchased 73%, 73% and 74%, respectively, of the production sold from the underlying properties.

For the years ended December 31, 2021, 2022 and 2023, MV Purchasing, LLC (“MV Purchasing”) purchased 73%, 74% and 73%, respectively, of the production sold from the underlying properties.

MV Purchasing is majority-owned by the indirect equity owners of MV Partners.

3 unchanged sentences

Tax counsel to the Trust also advised the Trust at the time of formation that in its opinion the Trust will be treated as a grantor trust for federal income tax purposes.

On the basis of this advice, Trust unitholders will be considered to own and receive the Trust’s assets and income and will be directly taxable

thereon as if no trust were in existence.

On the basis of this advice, Trust unitholders will be considered to own and receive the Trust’s assets and income and will be directly taxable thereon as if no trust were in existence.

No provision for federal or state income taxes has been made in the accompanying statements.

3 unchanged sentences

Such amounts will be equal to the excess, if any, of the cash received by the Trust relating to such preceding quarter, over the expenses of the Trust for such quarter, subject to adjustments for changes made by the Trustee during such quarter in any cash reserves established for future expenses of the Trust.

As previously disclosed, the Trustee intends to build a cash reserve of approximately $1.265 million for the payment of future known, anticipated or contingent expenses or liabilities of the Trust.

The Trustee may increase or decrease the targeted amount at any time, and may increase or decrease the rate at which it is withholding funds to build the cash reserve at any time, without advance notice to the unitholders.

Beginning in the first quarter of 2022, the Trustee withheld a portion of the proceeds otherwise available for distribution each quarter to gradually build an approximately $1.265 million cash reserve for the payment of future known, anticipated or contingent expenses or liabilities of the Trust.

The Trustee may increase or decrease the targeted amount at any time and may increase or decrease the rate at which it withholds funds to build the cash reserve at any time, without advance notice to the Trust unitholders.

Any cash reserved in excess of the amount necessary to pay or provide for the payment of future known, anticipated or contingent expenses or liabilities eventually will be distributed to Trust unitholders, together with interest earned on the funds.

The targeted $1.265 million cash reserve was fully funded as of April 25, 2023.

Period covered

24 unchanged sentences

July 1, 2023 through September 30, 2023

Pursuant to the conveyance of the net profits interest, MV Partners can reserve up to $1,000,000 for future exploration, development, maintenance or operating expenditures at any time.

There was no quarterly distribution during the third quarter of 2020 to Trust unitholders, as the revenue collected by MV Partners from April 1, 2020 through June 30, 2020 was not sufficient to cover the costs paid during the period.

MV Partners released $440,532 from the reserve for future expenditures to cover the deficit.

The reserve was reestablished during the fourth quarter of 2020.

Pursuant to the Conveyance, MV Partners can reserve up to $1,000,000 for future exploration, development, maintenance or operating expenditures at any time.

NOTE G — RELATED PARTY TRANSACTIONS

12 unchanged sentences

MV Partners provided a letter of credit in the amount of $1.8 million to the Trustee to protect the Trust against the risk that it does not have sufficient cash to pay future expenses.

As previously disclosed, the Trustee is building a reserve for the payment of future known, anticipated or contingent expenses or liabilities of the Trust.

Since January 2022, the Trustee has been withholding, and in the future intends to withhold, a portion of the proceeds otherwise available for distribution each quarter to build the cash reserve to approximately $1.265 million.

This amount is in addition to the letter of credit in the amount of $1.8 million provided to the Trustee by MV Partners to protect the Trust against the risk that it does not have sufficient cash to pay future expenses.

2 unchanged sentences

As of December 31, 2022, the Trustee has withheld a total of $737,919 from the proceeds otherwise available for distribution towards the building of this cash reserve, which is included in cash and cash equivalents on the accompanying Statements of Assets and Trust Corpus.

This cash reserve is included in cash and cash equivalents on the accompanying Statements of Assets and Trust Corpus.

NOTE I — OTHER EVENTS

2 unchanged sentences

Such distribution included the net proceeds of production collected by MV Partners from October 1, 2023 through December 31, 2023.

The Trustee withheld $263,541 from the distribution towards the building of its $1.265 million cash reserve for the payment of future known, anticipated or contingent expenses or liabilities of the Trust.

NOTE J — DISCLOSURES ABOUT OIL AND GAS ACTIVITIES (UNAUDITED)

4 unchanged sentences

Estimates of the proved oil and gas reserves attributable to the Trust as of December 31, 2021, 2022 and 2023 are based on reports of Cawley, Gillespie & Associates, Inc., independent petroleum and geological engineers, and the contract property management engineering staff of the managers of MV Partners who operate the underlying properties, in accordance with the SEC’s rules and definitions.

Users of this information should be aware that the process of estimating quantities of “proved” and “proved developed” and “proved

undeveloped” crude oil, natural gas, and natural gas liquids reserves is very complex, requiring significant subjective decisions in the evaluation of all available geological, engineering and economic data for each reservoir.

Users of this information should be aware that the process of estimating quantities of “proved” and “proved developed” and “proved undeveloped” crude oil, natural gas, and natural gas liquids reserves is very complex, requiring significant subjective decisions in the evaluation of all available geological, engineering and economic data for each reservoir.

The data for a given reservoir may also change substantially over time as a result of numerous factors, including additional development activity, evolving production history and continual reassessment of the viability of production under varying economic conditions.

3 unchanged sentences

A market value determination would include many additional factors, including:

(i) anticipated future oil and gas prices;

(i) anticipated

future oil and gas prices;

(ii) the effect of federal income taxes, if any, on the Trust;

34 unchanged sentences

Additional proved undeveloped reserves added during 2023

Proved undeveloped reserves removed from

drilling plan

Proved undeveloped reserves removed from drilling

Revisions of previous estimates

2 unchanged sentences

The Trust recognized net decreases to reserves of 4,313 Boe as a result of changes in the development plan.

Additional reductions to reserves of 570,844 Boe were a result of negative revisions due to lower commodity prices during 2020.

The Trust recognized net reductions to reserves for its share of MV Partners’ total during 2021 associated with the production of properties of 520,289 Boe.

The Trust recognized net decreases to reserves of (4,313) Boe as a result of changes in the development plan.

Net increases to reserves of 682,276 Boe were a result of positive revisions due to higher commodity prices during 2021.

2 unchanged sentences

Additional increases to reserves of 96,047 Boe were a result of positive revisions due to higher commodity prices during 2022.

The Trust recognized net reductions to reserves for its share of MV Partners’ total during 2023 associated with the production of properties of 488,444 Boe.

The Trust recognized net decreases to reserves of 21,859 Boe as a result of changes in the development plan.

Additional increases to reserves of 38,078 Boe were a result of positive revisions due to effectiveness of workovers and development during 2023.

STANDARDIZED MEASURE OF DISCOUNTED FUTURE NET CASH FLOWS

9 unchanged sentences

Standardized measure of discounted future net cash flows

TABLE OF CONTENTS

CHANGES IN STANDARDIZED MEASURE OF DISCOUNTED FUTURE NET CASH

4 unchanged sentences

(27,204,589 )

(18,068,560 )

Net changes in price and production costs

(21,474,622 )

Changes in estimated future development

Changes in estimated future development costs

Development costs incurred during the year

9 unchanged sentences

NGL (per Bbl)

TABLE OF CONTENTS

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data