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Item 1A. Risk Factors

2025-03-19 compared with 2024-03-22 · 613 added, 729 removed, 447 unchanged (75% of the section changed)

Risk Factors.

The risk factors summarized and detailed below

could materially harm production from the Underlying Properties, operating results and/or the Trust’s financial condition, adversely

affect proceeds to the Trust and cash distributions to Trust unitholders, and/or cause the price of the Trust Units to decline.

are not all the risks the Trust faces, and other factors not presently known to the Trust or that the Trust currently believes are immaterial

may also affect the Trust if they occur.

Summary of Risk Factors

risk factors summarized and detailed below could materially harm production from the Underlying Properties, operating results and/or

the Trust’s financial condition, adversely affect proceeds to the Trust and cash distributions to Trust unitholders, and/or cause

the price of the Trust Units to decline.

These are not all the risks the Trust faces, and other factors not presently known to the Trust

or that the Trust currently believes are immaterial may also affect the Trust if they occur.

risks and uncertainties include, but are not limited to, the following :

The following is a summary of some of the risks

and uncertainties that could materially affect the Trust’s business, financial condition and results of operations.

You should read

this summary together with the more detailed description of each risk factor contained below.

Business and Operating Risks

Prices of oil and

natural gas fluctuate, and lower prices could reduce proceeds to the Trust and cash distributions

to Trust unitholders.

Actual reserves and

future production may be less than current estimates, which could reduce cash distributions

by the Trust and the value of the Trust Units.

The ability or willingness

of OPEC and other oil exporting nations to set and maintain production levels has a significant

impact on oil and natural gas commodity prices, which could reduce the amount of cash available

for distribution to Trust unitholders.

Third-party operators

are the operators of all of the wells on the Underlying Properties and, therefore, the Sponsor

is not in a position to control the timing of development efforts, the associated costs or

the rate of production of the reserves on such properties.

Developing oil and

natural gas wells and producing oil and natural gas are costly and high-risk activities with

many uncertainties that could adversely affect future production from the Underlying Properties.

Any delays, reductions or cancellations in development and producing activities could decrease

revenues that are available for distribution to Trust unitholders.

Shortages of equipment,

services and qualified personnel could increase costs of developing and operating the Underlying

· Prices of oil and natural gas fluctuate, and lower prices could reduce proceeds to the Trust and cash distributions to Trust unitholders.

· Actual reserves and future production may be less than current estimates, which could reduce cash distributions by the Trust and the

value of the Trust Units.

· The ability or willingness of OPEC and other oil exporting nations to set and maintain production levels has a significant impact

on oil and natural gas commodity prices.

· Third-party operators operate all of the wells on the Underlying Properties;

therefore, the Sponsor is not in a position to control

the timing of development efforts, the associated costs or the rate of production of the reserves on such properties.

· Developing oil and natural gas wells and producing oil and natural gas are costly and high-risk activities with many uncertainties

that could adversely affect future production from the Underlying Properties.

· Shortages of equipment, services and qualified personnel could increase costs of developing and operating the Underlying Properties

and reduce the amount of cash available for distribution to Trust unitholders.

· The amount of cash available for distribution by the Trust depends in part on access to and operation of gathering, transportation

and processing facilities.

· Adverse developments in Texas, Louisiana or New Mexico could adversely impact the results of operations and cash flows of the Underlying

Properties and reduce the amount of cash available for distribution to Trust unitholders.

The amount of cash

available for distribution by the Trust depends in part on access to and operation of gathering,

transportation and processing facilities.

Any limitation in the availability of those facilities

could interfere with sales of oil and natural gas production from the Underlying Properties.

Adverse developments

in Texas, Louisiana or New Mexico could adversely impact the results of operations and cash

flows of the Underlying Properties and reduce the amount of cash available for distribution

to Trust unitholders.

Financial Risks

Trust Units may lose value as a result of title deficiencies with respect to the Underlying

reserves attributable to the Underlying Properties are depleting assets and production from

those reserves will diminish over time.

Furthermore, the Trust is precluded from acquiring

other oil and natural gas properties or net profits interests to replace the depleting assets

and production.

Therefore, proceeds to the Trust and cash distributions to Trust unitholders

will decrease over time.

increase in the differential between the price realized by the Sponsor for oil and natural

gas produced from the Underlying Properties and the NYMEX or other benchmark price of oil

or natural gas could reduce the net profits payable to the Trust and, therefore, the cash

distributions by the Trust and the value of the Trust Units.

production and development costs and expenses related to the Underlying Properties and other

costs and expenses incurred by the Trust, without concurrent increases in revenue, will reduce

the amount of cash available for distribution to Trust unitholders.

Trust has established a cash reserve for contingent liabilities and to pay expenses in accordance

with the Trust Agreement, which would reduce net profits payable to the Trust and distributions

· The Trust Units may lose value as a result of title deficiencies with respect to the Underlying Properties.

· The oil and natural gas reserves attributable to the Underlying Properties are depleting assets and production

from those reserves will diminish over time.

· An increase in the differential between the price realized by the Sponsor for oil and natural gas produced

from the Underlying Properties and the NYMEX or other benchmark price of oil or natural gas could reduce the net profits payable to the

Trust and, therefore, the cash distributions by the Trust and the value of the Trust Units.

· Higher production and development costs and expenses related to the Underlying Properties and other costs

and expenses incurred by the Trust, without concurrent increases in revenue, will reduce the amount of cash available for distribution

to Trust unitholders.

amount of cash available for distribution by the Trust could be reduced by expenses caused

by uninsured claims.

Sponsor’s ability to perform its obligations to the Trust could be limited by restrictions

under its debt agreements.

bankruptcy of the Sponsor or any of the third-party operators could impede the operation

of the wells and the development of the proved undeveloped reserves.

the event of the bankruptcy of the Sponsor, if a court were to hold that the Net Profits

Interest was part of the bankruptcy estate, the Trust may be treated as an unsecured creditor

with respect to the Net Profits Interest attributable to properties in Louisiana and New

· The Trust has established a cash reserve for contingent liabilities and to pay expenses in accordance

with the Trust Agreement, which would reduce net profits payable to the Trust and distributions to Trust unitholders.

· The amount of cash available for distribution by the Trust could be reduced by expenses caused by uninsured

· The Sponsor’s ability to perform its obligations to the Trust could be limited by restrictions under

its debt agreements.

· The bankruptcy of the Sponsor or any of the third-party operators could impede the operation of the wells

and the development of the proved undeveloped reserves.

· In the event of the bankruptcy of the Sponsor, if a court were to hold that the Net Profits Interest was

part of the bankruptcy estate, the Trust may be treated as an unsecured creditor with respect to the Net Profits Interest attributable

to properties in Louisiana and New Mexico.

Risks Related to the Structure of the Trust

The Trust is passive

in nature and neither the Trustee nor the Trust unitholders have any ability to influence

the Sponsor or control the operations or development of the Underlying Properties.

Subject to specified

limitations, the Sponsor may transfer all or a portion of the Underlying Properties at any

time without Trust unitholder consent.

Under certain circumstances,

the Trustee must sell the Net Profits Interest and dissolve the Trust prior to the expected

termination of the Trust.

As a result, Trust unitholders may not recover their investment.

Conflicts of interest

could arise between the Sponsor and its affiliates, on the one hand, and the Trust and the

Trust unitholders, on the other hand.

The Trust is administered

by a Trustee who cannot be replaced except by a majority vote of the Trust unitholders at

a special meeting, which may make it difficult for Trust unitholders to remove or replace

Trust unitholders

have limited ability to enforce provisions of the Conveyance, and the Sponsor’s liability

to the Trust is limited.

Financial information

of the Trust is not prepared in accordance with GAAP.

The Trust is a smaller

reporting company and benefits from certain reduced governance and disclosure requirements,

including that the Trust’s independent registered public accounting firm is not required

to attest to the effectiveness of the Trust’s internal control over financial reporting.

The Trust cannot be certain if the omission of reduced disclosure requirements applicable

to smaller reporting companies will make the Trust Units less attractive to investors.

· The Trust is passive in nature and neither the Trustee nor the Trust unitholders have any ability to influence the Sponsor or control

the operations or development of the Underlying Properties.

· Subject to specified limitations, the Sponsor may transfer all or a portion of the Underlying Properties at any time without Trust

unitholder consent.

· Under certain circumstances, the Trustee must sell the Net Profits Interest and dissolve the Trust prior to the expected termination

of the Trust.

· Conflicts of interest could arise between the Sponsor and its affiliates, on the one hand, and the Trust and the Trust unitholders,

on the other hand.

· The Trust is administered by a Trustee who cannot be replaced except by a majority vote of the Trust unitholders at a special meeting.

· Trust unitholders have limited ability to enforce provisions of the Conveyance.

· Financial information of the Trust is not prepared in accordance with GAAP.

· The Trust is a smaller reporting company and benefits from certain reduced governance and disclosure requirements, which could make

the Trust Units less attractive to investors.

Risks Related to Ownership of the Trust Units

If the Trust cannot

meet the New York Stock Exchange continued listing requirements, the NYSE may delist the

The Sponsor may sell

Trust Units in the public or private markets, and such sales may have an adverse impact on

the trading price of the Trust Units.

The trading price

for the Trust Units may not reflect the value of the Net Profits Interest held by the Trust.

Courts outside of

Delaware may not recognize the limited liability of Trust unitholders provided under Delaware

· If the Trust cannot meet continued listing requirements, the NYSE may delist the Trust Units.

· The Sponsor may sell Trust Units in the public or private markets, and such sales may have an adverse impact on the trading price

of the Trust Units.

· The trading price for the Trust Units may not reflect the value of the Net Profits Interest held by the Trust.

· Courts outside of Delaware may not recognize the limited liability of Trust unitholders.

Legal, Environmental and Regulatory Risks

The operations of

the Underlying Properties are subject to environmental laws and regulations that could adversely

affect the cost, manner or feasibility of conducting operations on them or result in significant

costs and liabilities, which could reduce the amount of cash available for distribution to

Trust unitholders.

The operations on

the Underlying Properties are subject to complex federal, state, local and other laws and

regulations that could adversely affect the cost, manner or feasibility of conducting operations

on them or expose the operator to significant liabilities, which could reduce the amount

of cash available for distribution to Trust unitholders.

Climate change laws

and regulations restricting emissions of “greenhouse gases”

could result in increased

operating costs and reduced demand for the oil and natural gas that the operators produce

while the physical effects of climate change could disrupt their production and cause them

to incur significant costs in preparing for or responding to those effects.

Federal and state

legislative and regulatory initiatives relating to hydraulic fracturing could result in increased

costs and additional operating restrictions or delays as well as adversely affect the services

of the operators of the Underlying Properties.

· The operations on the Underlying Properties are subject to complex federal, state, local and other laws and regulations, including

environmental regulations, that could adversely affect the cost, manner or feasibility of conducting operations on them or expose the

operator to significant liabilities.

· Climate change laws and regulations restricting emissions of “greenhouse gases”

could result in increased operating costs

and reduced demand for the oil and natural gas that the operators produce while the physical effects of climate change could disrupt their

production and cause them to incur significant costs in preparing for or responding to those effects.

· Federal and state legislative and regulatory initiatives relating to hydraulic fracturing could result in increased costs and additional

operating restrictions or delays.

Cybersecurity Risks

Cyber-attacks or other

failures in telecommunications or information technology systems could result in information

theft, data corruption and significant disruption of the Sponsor’s or the Trustee’s

· Cyber-attacks or other failures in telecommunications or information technology systems could result in information theft, data corruption

and significant disruption of the Sponsor’s or the Trustee’s operations.

Tax Risks Related to the Trust Units

If the IRS were to

determine (and be sustained in that determination) that the Trust is not a “grantor

federal income tax purposes, the Trust could be subject to more complex

and costly tax reporting requirements that could reduce the amount of cash available for

distribution to Trust unitholders.

Trust unitholders

are required to pay taxes on their share of the Trust’s income even if they do not

receive any cash distributions from the Trust.

A portion of any tax

gain on the disposition of the Trust Units could be taxed as ordinary income.

The Trust allocates

its items of income, gain, loss and deduction between transferors and transferees of the

Trust Units each month based upon the ownership of the Trust Units on the monthly record

date, instead of on the basis of the date a particular Trust Unit is transferred.

may challenge this treatment, which could change the allocation of items of income, gain,

loss and deduction among the Trust unitholders.

· If the IRS were to determine (and be sustained in that determination) that the Trust is not a “grantor trust”

federal income tax purposes, the Trust could be subject to more complex and costly tax reporting requirements that could reduce the amount

of cash available for distribution to Trust unitholders.

· Trust unitholders are required to pay taxes on their share of the Trust’s income even if they do not receive any cash distributions

from the Trust.

· A portion of any tax gain on the disposition of the Trust Units could be taxed as ordinary income.

· The IRS may challenge the Trust’s approach to allocating its items of income, gain, loss and deduction between transferors and

transferees of the Trust Units each month based upon the ownership of the Trust Units on the monthly record date, instead of on the basis

of the date a particular Trust Unit is transferred.

BUSINESS AND OPERATING RISKS

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and lower prices could reduce proceeds to the Trust and cash distributions to Trust unitholders.

The Trust’s reserves and monthly cash distributions

are highly dependent upon the prices realized from the sale of oil and natural gas.

Oil and natural gas prices can fluctuate widely on

a month-to-month basis in response to a variety of factors that are beyond the control of the Trust and the Sponsor.

These factors include,

among others:

regional, domestic

and foreign supply and perceptions of supply of oil and natural gas;

the level of demand

and perceptions of demand for oil and natural gas;

political conditions

or hostilities in oil and natural gas producing regions;

the armed conflicts

between Russia and Ukraine and between Israel and Hamas and the potential destabilizing effects

Trust’s reserves and monthly cash distributions are highly dependent upon the prices realized from the sale of oil and natural gas.

Oil and natural gas prices can fluctuate widely on a month-to-month basis in response to a variety of factors that are beyond the control

of the Trust and the Sponsor.

These factors include, among others:

· regional, domestic and foreign supply and perceptions of supply of oil and natural gas;

· the level of demand and perceptions of demand for oil and natural gas;

· political conditions or hostilities in oil and natural gas producing regions;

· the armed conflicts between Russia and Ukraine and between Israel and Iran and its proxies and the potential destabilizing effects

such conflicts may pose for the global oil and gas markets;

the actions of OPEC,

its members and other oil-producing nations, such as Russia, relating to oil price and production

levels, including announcements of potential changes to such levels;

the levels of production

of oil and natural gas of non-OPEC countries;

anticipated future

prices of oil and natural gas and other commodities;

weather conditions

and seasonal trends;

technological advances

affecting energy consumption and energy supply;

and worldwide

economic conditions;

the occurrence or threat

of epidemic or pandemic diseases, such as the COVID-19 pandemic, or any government response

to such occurrence or threat;

the price and availability

of alternative fuels;

the proximity, capacity,

cost and availability of gathering and transportation facilities;

the volatility and

uncertainty of regional pricing differentials;

governmental regulations

and taxation;

energy conservation

and environmental measures;

· the actions of OPEC, its members and other oil-producing nations, such as Russia, relating to oil price and production levels, including

announcements of potential changes to such levels;

· the levels of production of oil and natural gas of non-OPEC countries;

· anticipated future prices of oil and natural gas and other commodities;

· weather conditions and seasonal trends;

· technological advances affecting energy consumption and energy supply;

and worldwide economic conditions;

· trade barriers and tariffs;

· the occurrence or threat of epidemic or pandemic diseases or other public health event or any government response to such occurrence

· the price and availability of alternative fuels;

· the proximity, capacity, cost and availability of gathering and transportation facilities;

· the volatility and uncertainty of regional pricing differentials;

· governmental regulations and taxation;

· energy conservation and environmental measures;

· acts of force majeure.

These factors and the volatility of the energy

markets make it extremely difficult to predict future oil and natural gas price movements with any certainty.

Commodity prices displayed

dramatic volatility in 2020, when the COVID-19 pandemic and various governmental actions taken to mitigate the impact of COVID-19

resulted in an unprecedented decline in demand for oil and natural gas.

The effects of the economic disruption caused by the governmental

responses to the COVID-19 pandemic continued to be felt through 2023, in the form of lingering supply chain disruptions, higher inflation

and higher interest rates, which affected supply and demand for oil and natural gas.

Meanwhile, as strains or variants of COVID-19

resurge, or if other epidemic or pandemic diseases or other public health event were to occur, the negative impact to global demand for

oil and natural gas could be material.

substantial or extended decline in oil or natural gas prices will reduce profits to which the Trust is entitled and therefore the

amount of cash available for distribution to Trust unitholders.

A prolonged period of low oil or natural gas prices may ultimately

reduce the amount of oil and natural gas that is economically viable to produce from the Underlying Properties.

As a result, the operators

of the Underlying Properties could determine during periods of low commodity prices to shut-in or curtail production from wells on the

Underlying Properties, or even plug and abandon marginal wells that otherwise may have been allowed to continue to produce for a longer

period under conditions of higher prices.

Specifically, an operator may abandon any well or property if it reasonably believes that the

well or property can no longer produce oil or natural gas in commercially paying quantities.

This could result in termination of the

Net Profits Interest relating to the abandoned well or property.

factors and the volatility of the energy markets make it extremely difficult to predict future oil and natural gas price movements with

any certainty.

A substantial or extended decline in oil or natural gas prices will reduce profits to which the Trust is entitled

and therefore the amount of cash available for distribution to Trust unitholders.

A prolonged period of low oil or natural gas

prices may ultimately reduce the amount of oil and natural gas that is economically viable to produce from the Underlying Properties.

As a result, the operators of the Underlying Properties could determine during periods of low commodity prices to shut-in or curtail production

from wells on the Underlying Properties, or even plug and abandon marginal wells that otherwise may have been allowed to continue to produce

for a longer period under conditions of higher prices.

Specifically, an operator may abandon any well or property if it reasonably believes

that the well or property can no longer produce oil or natural gas in commercially paying quantities.

This could result in termination

of the Net Profits Interest relating to the abandoned well or property.

The Underlying Properties are sensitive to decreasing

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The Sponsor has not entered into any hedge contracts

relating to oil and natural gas volumes expected to be produced on behalf of the Trust, and the terms of the Conveyance prohibit the

Sponsor from entering into new hedging arrangements burdening the Trust.

As a result, all production in which the Trust has an interest

is unhedged, and the amount of cash available for distribution may be subject to greater fluctuations due to changes in oil and natural

relating to oil and natural gas volumes expected to be produced on behalf of the Trust, and the terms of the Conveyance prohibit the Sponsor

from entering into new hedging arrangements burdening the Trust.

As a result, all production in which the Trust has an interest is unhedged,

and the amount of cash available for distribution may be subject to greater fluctuations due to changes in oil and natural gas prices.

Actual reserves and future production may

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The value of the Trust Units and the amount of

future cash distributions to the Trust unitholders will depend upon, among other things, the accuracy of the reserves and future production

estimated to be attributable to the Trust’s interest in the Underlying Properties.

It is not possible to measure underground accumulations

of oil and natural gas in an exact way, and estimating reserves is inherently uncertain.

Ultimately, actual production and revenues from

the Underlying Properties could vary both positively and negatively and in material amounts from estimates.

Furthermore, direct operating

expenses and development expenses relating to the Underlying Properties could be substantially higher than current estimates.

engineers are required to make subjective estimates of underground accumulations of oil and natural gas based on factors and assumptions

that include:

historical production

from the area compared with production rates from other producing areas;

oil and natural gas

prices, production levels, Btu content, production expenses, transportation costs, severance

and excise taxes and development expenses;

the availability of

enhanced recovery techniques;

relationships with

landowners, operators, pipeline companies and others;

the assumed effect

of expected governmental regulation and future tax rates.

future cash distributions to the Trust unitholders will depend upon, among other things, the accuracy of the oil and natural gas reserves

and future production estimated to be attributable to the Trust’s interest in the Underlying Properties.

It is not possible to measure

underground accumulations of oil and natural gas in an exact way, and estimating reserves is inherently uncertain.

Ultimately, actual

production and revenues from the Underlying Properties could be materially lower than estimates.

Furthermore, direct operating expenses

and development expenses relating to the Underlying Properties could be substantially higher than current estimates.

Petroleum engineers

are required to make subjective estimates of underground accumulations of oil and natural gas based on factors and assumptions that include:

· historical production from the area compared with production rates from other producing areas;

· oil and natural gas prices, production levels, Btu content, production expenses, transportation costs, severance and excise taxes

and development expenses;

· the availability of enhanced recovery techniques;

· relationships with landowners, operators, pipeline companies and others;

· the assumed effect of expected governmental regulation and future tax rates.

Changes in these assumptions and amounts of actual

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In addition, the quantities of recovered

reserves attributable to the Underlying Properties may decrease in the future as a result of future decreases in the price of oil or

reserves attributable to the Underlying Properties may decrease in the future as a result of future decreases in the price of oil or natural

The reserve report estimating the Trust’s

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Actions taken by OPEC members, including those

taken alongside other oil exporting nations, have a significant impact on global oil supply and pricing.

For example, OPEC and certain

other oil exporting nations have previously agreed to take measures, including production cuts, to support crude oil prices OPEC members

and other oil exporting nations might not agree to future production cuts or other actions to support and stabilize oil prices, and they

may not reduce oil prices or increase production in the future.

Uncertainty regarding future actions that OPEC members or other oil exporting

countries may take could lead to continued volatility in the price of oil, which could adversely affect the financial condition and economic

performance of the operators of the Underlying Properties and may reduce the net proceeds to which the Trust is entitled, which could

materially reduce or completely eliminate the amount of cash available for distribution to Trust unitholders.

Third-party operators are the operators

of all of the wells on the Underlying Properties and, therefore, the Sponsor is not in a position to control the timing of development

efforts, the associated costs or the rate of production of the reserves on such properties.

taken alongside other oil exporting nations, such as Russia, have a significant impact on global oil supply and pricing.

OPEC and certain other oil exporting nations, such as Russia, have previously agreed to take measures, including production cuts, to support

crude oil prices OPEC members and other oil exporting nations might not agree to future production cuts or other actions to support and

stabilize oil prices, and they may not reduce oil prices or increase production in the future.

Uncertainty regarding future actions that

OPEC members or other oil exporting countries may take could lead to continued volatility in the price of oil, which could adversely affect

the financial condition and economic performance of the operators of the Underlying Properties and may reduce the net proceeds to which

the Trust is entitled, which could materially reduce or completely eliminate the amount of cash available for distribution to Trust unitholders.

Third-party operators operate all of the

wells on the Underlying Properties;

therefore, the Sponsor is not in a position to control the timing of development efforts, the associated

costs or the rate of production of the reserves on such properties.

As of December 31, 2024, all of the wells

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operated by the third-party operators depend on factors that are largely outside of the Sponsor’s control, including:

timing and amount of capital expenditures, which could be significantly more than anticipated;

the availability of

suitable drilling equipment, production and transportation infrastructure and qualified operating

third-party operators’

expertise, operating efficiency and financial resources;

of other participants in drilling wells;

selection of technology;

selection of counterparties for the sale of production;

rate of production of the reserves.

· the timing and amount of capital expenditures, which could be

significantly more than anticipated;

· the availability of suitable drilling equipment, production and transportation infrastructure and qualified operating personnel;

· the third-party operators’

expertise, operating efficiency

and financial resources;

· approval of other participants in drilling wells;

· the selection of technology;

· the selection of counterparties for the sale of production;

· the rate of production of the reserves.

The third-party operators may elect not to undertake

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that are available for distribution to Trust unitholders.

The process of developing oil and natural gas

wells and producing oil and natural gas on the Underlying Properties is subject to numerous risks beyond the control of the Trust, the

Sponsor or the third-party operators, including risks that could delay the operators’

current drilling or production schedule and

the risk that drilling will not result in commercially viable oil or natural gas production.

The ability of the operators to carry out

operations or to finance planned development expenses could be materially and adversely affected by any factor that may curtail, delay,

reduce or cancel development and production, including:

in oil or natural gas prices;

delays imposed by or

resulting from compliance with environmental and other governmental or regulatory requirements,

including permitting;

or unexpected geological formations;

of or delays in obtaining equipment and qualified personnel;

lack of available gathering,

transportation and processing facilities, including availability on commercially reasonable

terms, or delays in construction of gathering facilities;

of available capacity on interconnecting transmission pipelines;

malfunctions, failures or accidents;

operational events and drilling conditions;

limitations for oil or natural gas;

or cement failures;

or damaged drilling and service tools;

of drilling fluid circulation;

uncontrollable

flows of oil and natural gas, inert gas, water or drilling fluids;

explosions, fires and natural disasters;

environmental hazards,

such as oil and natural gas leaks, pipeline ruptures and discharges of toxic gases or other

pollutants into the surface or subsurface environment;

weather conditions;

or natural gas property title problems or legal disputes regarding leasehold rights.

The process of developing oil and natural gas wells

and producing oil and natural gas on the Underlying Properties is subject to numerous risks beyond the control of the Trust, the Sponsor

or the third-party operators, including risks that could delay the operators’

current drilling or production schedule and the risk

that drilling will not result in commercially viable oil or natural gas production.

The ability of the operators to carry out operations

or to finance planned development expenses could be materially and adversely affected by any factor that may curtail, delay, reduce or

cancel development and production, including:

· declines in oil or natural gas prices;

· delays imposed by or resulting from compliance with environmental and other governmental or regulatory requirements, including permitting;

· unusual or unexpected geological formations;

· shortages of or delays in obtaining equipment and qualified

· lack of available gathering, transportation and processing facilities, including availability on commercially reasonable terms, or

delays in construction of gathering facilities;

· lack of available capacity on interconnecting transmission pipelines;

· equipment malfunctions, failures or accidents;

· unexpected operational events and drilling conditions;

· market limitations for oil or natural gas;

· pipe or cement failures;

· casing collapses;

· lost or damaged drilling and service tools;

· loss of drilling fluid circulation;

· uncontrollable flows of oil and natural gas, inert gas, water

or drilling fluids;

· blowouts, explosions, fires and natural disasters;

· environmental hazards, such as oil and natural gas leaks, pipeline ruptures and discharges of toxic gases or other pollutants into

the surface or subsurface environment;

· adverse weather conditions;

· oil or natural gas property title problems or legal disputes

regarding leasehold rights.

If planned operations, including drilling of development

wells, are delayed or cancelled, or if existing wells or development wells experience production below anticipated levels due to one

or more of the foregoing factors or for any other reason, future distributions to Trust unitholders may be reduced.

wells, are delayed or cancelled, or if existing wells or development wells experience production below anticipated levels due to one or

more of the foregoing factors or for any other reason, future distributions to Trust unitholders may be reduced.

If an operator incurs

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factors also cause significant increases in costs for equipment, services and personnel.

Higher oil and natural gas prices generally

stimulate demand and result in increased prices for drilling rigs, crews and associated supplies, equipment and services.

field personnel and equipment or price increases could hinder the ability of the operators of the Underlying Properties to conduct the

operations that they currently have planned for the Underlying Properties, which would reduce the amount of cash received by the Trust

and available for distribution to Trust unitholders.

Higher oil and natural gas prices generally stimulate

demand and result in increased prices for drilling rigs, crews and associated supplies, equipment and services.

Shortages of field personnel

and equipment or price increases could hinder the ability of the operators of the Underlying Properties to conduct the operations that

they currently have planned for the Underlying Properties, which would reduce the amount of cash received by the Trust and available for

distribution to Trust unitholders.

The amount of cash available for distribution

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availability of those facilities could interfere with sales of oil and natural gas production from the Underlying Properties.

The amount of oil and natural gas that may be

produced and sold from a well is subject to curtailment in certain circumstances, such as by reason of weather conditions, pipeline interruptions

The amount of oil and natural gas that may be produced

and sold from a well is subject to curtailment in certain circumstances, such as by reason of weather conditions, pipeline interruptions

due to scheduled and unscheduled maintenance, failure of tendered oil and natural gas to meet quality specifications of gathering lines

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In many cases, the

operators of the Underlying Properties receive only limited notice, if any, as to when production will be curtailed and the duration

of such curtailments.

operators of the Underlying Properties receive only limited notice, if any, as to when production will be curtailed and the duration of

such curtailments.

If the operators of the Underlying Properties are forced to reduce production due to such a curtailment, the revenues

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of title deficiencies with respect to the Underlying Properties.

Enduro acquired the Underlying Properties through

various acquisitions in late 2010 and early 2011.

The Sponsor acquired Enduro’s interests in the Underlying Properties pursuant

to the Sale Transaction that closed in August 2018.

The existence of a material title deficiency with respect to the Underlying

Properties could reduce the value of a property or render it worthless, thus adversely affecting the Net Profits Interest and the distributions

to Trust unitholders.

The Sponsor does not obtain title insurance covering mineral leaseholds, and the Sponsor’s failure to cure

any title defects may cause the Sponsor to lose its rights to production from the Underlying Properties.

If a material title problem

were to arise, net profits available for distribution to Trust unitholders, and the value of the Trust Units, may be reduced.

The reserves attributable to the Underlying

Properties are depleting assets and production from those reserves will diminish over time.

Furthermore, the Trust is precluded from

acquiring other oil and natural gas properties or net profits interests to replace the depleting assets and production.

Therefore, proceeds

to the Trust and cash distributions to Trust unitholders will decrease over time.

acquired the Underlying Properties through various acquisitions in late 2010 and early 2011.

The Sponsor acquired Enduro’s

interests in the Underlying Properties pursuant to the Sale Transaction that closed in August 2018.

The existence of a material title

deficiency with respect to the Underlying Properties could reduce the value of a property or render it worthless, thus adversely affecting

the Net Profits Interest and the distributions to Trust unitholders.

The Sponsor does not obtain title insurance covering mineral leaseholds,

and the Sponsor’s failure to cure any title defects may cause the Sponsor to lose its rights to production from the Underlying Properties.

If a material title problem were to arise, net profits available for distribution to Trust unitholders, and the value of the Trust Units,

may be reduced.

The oil and natural gas reserves attributable

to the Underlying Properties are depleting assets and production from those reserves will diminish over time.

Furthermore, because the

Trust is precluded from acquiring other oil and natural gas properties or net profits interests to replace the depleting assets and production,

proceeds to the Trust and cash distributions to Trust unitholders will decrease over time.

The net profits payable to the Trust attributable

to the Net Profits Interest are derived from the sale of production of oil and natural gas from the Underlying Properties.

attributable to the Underlying Properties are depleting assets, which means that the reserves and the quantity of oil and natural gas

produced from the Underlying Properties will decline over time.

Future maintenance projects on the Underlying

Properties may affect the quantity of proved reserves that can be economically produced from wells on the Underlying Properties.

timing and size of these projects will depend on, among other factors, the market prices of oil and natural gas.

Neither the Sponsor

nor, to the Sponsor’s knowledge, the third-party operators have a contractual obligation to develop or otherwise pay development

expenses on the Underlying Properties in the future.

Furthermore, with respect to properties for which the Sponsor is not designated

as the operator, the Sponsor has limited control over the timing or amount of those development expenses.

The Sponsor also has the right

to non-consent and not participate in the development expenses on properties for which it is not the operator, in which case the Sponsor

and the Trust will not receive the production resulting from such development expenses.

If the operators of the Underlying Properties

do not implement maintenance projects when warranted, the future rate of production decline of proved reserves may be higher than the

rate currently expected by the Sponsor or estimated in the reserve report.

natural gas reserves attributable to the Underlying Properties are depleting assets, which means that the reserves and the quantity of

oil and natural gas produced from the Underlying Properties will decline over time.

maintenance projects on the Underlying Properties may affect the quantity of proved reserves that can be economically produced from wells

on the Underlying Properties.

The timing and size of these projects will depend on, among other factors, the market prices of oil and

Neither the Sponsor nor, to the Sponsor’s knowledge, the third-party operators have a contractual obligation

to develop or otherwise pay development expenses on the Underlying Properties in the future.

Furthermore, with respect to properties for

which the Sponsor is not designated as the operator, the Sponsor has limited control over the timing or amount of those development expenses.

The Sponsor also has the right to non-consent and not participate in the development expenses on properties for which it is not the operator,

in which case the Sponsor and the Trust will not receive the production resulting from such development expenses.

If the operators of

the Underlying Properties do not implement maintenance projects when warranted, the future rate of production decline of proved reserves

may be higher than the rate currently expected by the Sponsor or estimated in the reserve report.

The Trust Agreement provides that the Trust’s

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required or permitted by the terms of the Conveyance related to the Net Profits Interest.

As a result, the Trust is not permitted to

acquire other oil and natural gas properties or net profits interests to replace the depleting assets and production attributable to

the Net Profits Interest.

As a result, the Trust is not permitted to acquire

other oil and natural gas properties or net profits interests to replace the depleting assets and production attributable to the Net Profits

Because the net profits payable to the Trust are

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At that point the value of the Trust Units should be expected to be $0.

An increase in the differential between

the price realized by the Sponsor for oil or natural gas produced from the Underlying Properties and the NYMEX or other benchmark price

of oil or natural gas could reduce the net profits payable to the Trust and, therefore, the cash distributions by the Trust and the value

An increase in the differential between the

price realized by the Sponsor for oil or natural gas produced from the Underlying Properties and the NYMEX or other benchmark price of

oil or natural gas could reduce the net profits payable to the Trust and, therefore, the cash distributions by the Trust and the value

of the Trust Units.

The prices received for the Sponsor’s oil

and natural gas production usually fall below the relevant benchmark prices, such as NYMEX, that are used for calculating hedge positions.

prices received for the Sponsor’s oil and natural gas production usually fall below the relevant benchmark prices, such as NYMEX,

that are used for calculating hedge positions.

The difference between the price received and the benchmark price is called a basis differential.

The differential may vary significantly

due to market conditions, the quality and location of production and other factors.

The Sponsor cannot accurately predict oil or natural

gas differentials.

Increases in the differential between the realized price of oil and natural gas and the benchmark price for oil and

natural gas could reduce the profits to the Trust, the cash distributions by the Trust and the value of the Trust Units.

Higher production and development costs

and expenses related to the Underlying Properties and other costs and expenses incurred by the Trust, without concurrent increases in

revenue, will reduce the amount of cash available for distribution to Trust unitholders.

The differential may vary significantly due to market conditions, the quality and location of production and other factors.

Sponsor cannot accurately predict oil or natural gas differentials.

Increases in the differential between the realized price of oil and

natural gas and the benchmark price for oil and natural gas could reduce the profits to the Trust, the cash distributions by the Trust

and the value of the Trust Units.

Higher production and development costs and

expenses related to the Underlying Properties and other costs and expenses incurred by the Trust, without concurrent increases in revenue,

will reduce the amount of cash available for distribution to Trust unitholders.

The Trust indirectly bears an 80% share of all

costs and expenses related to the Underlying Properties, such as direct operating and development expenses, which reduces the amount

of cash received by the Trust and thereafter distributable to Trust unitholders.

Accordingly, higher costs and expenses related to the

Underlying Properties will directly decrease the amount of cash received by the Trust in respect of its Net Profits Interest.

costs may not be indicative of future costs.

For example, the third-party operators may in the future propose additional drilling projects

that significantly increase the capital expenditures associated with the Underlying Properties, which could reduce cash available for

distribution by the Trust.

In addition, cash available for distribution by the Trust will be further reduced by the Trust’s general

and administrative expenses.

costs and expenses related to the Underlying Properties, such as direct operating and development expenses, which reduces the amount of

cash received by the Trust and thereafter distributable to Trust unitholders.

Accordingly, higher costs and expenses related to the Underlying

Properties will directly decrease the amount of cash received by the Trust in respect of its Net Profits Interest.

Historical costs may

not be indicative of future costs.

For example, the third-party operators may in the future propose additional drilling projects that

significantly increase the capital expenditures associated with the Underlying Properties, which could reduce cash available for distribution

by the Trust.

In addition, cash available for distribution by the Trust will be further reduced by the Trust’s general and administrative

If direct operating and development expenses on

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The Trust has established

a cash reserve for contingent liabilities and to pay expenses in accordance with the Trust Agreement, which would reduce net profits

payable to the Trust and distributions to Trust unitholders.

a cash reserve for contingent liabilities and to pay expenses in accordance with the Trust Agreement, which would reduce net profits payable

to the Trust and distributions to Trust unitholders.

The Trust’s source

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Pursuant to the Trust Agreement, the Trust may establish a cash reserve through

the withholding of cash for contingent liabilities and to pay expenses, which will reduce the amount of cash otherwise available for

distribution to Trust unitholders.

November 2021, the Trustee notified the Sponsor of the Trustee’s intent to build a cash reserve for the payment of future

known, anticipated or contingent expenses or liabilities of the Trust.

From February 2022 through March 2023, the Trustee withheld

$37,833, and commencing with the distribution to Trust unitholders paid in April 2023 has been withholding and, in the future, intends

to withhold $50,000, from the funds otherwise available for distribution each month to gradually build a cash reserve of approximately

$2.3 million.

As of December 31, 2023, the cumulative cash reserve balance was $941,386.

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 Trust unitholders.

the withholding of cash for contingent liabilities and to pay expenses, which will reduce the amount of cash otherwise available for distribution

to Trust unitholders.

In November 2021, the Trustee notified the

Sponsor of the Trustee’s intent to build a cash reserve for the payment of future known, anticipated or contingent expenses or liabilities

of the Trust.

From February 2022 through March 2023, the Trustee withheld $37,833, and commencing with the distribution to Trust

unitholders paid in April 2023 has been withholding and, in the future, intends to withhold $50,000, from the funds otherwise available

for distribution each month to gradually build a cash reserve of approximately $2.3 million.

As of December 31, 2024, the cumulative

cash reserve balance was $1,241,386.

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 Trust unitholders.

The amount of cash available for distribution

by the Trust could be reduced by expenses caused by uninsured claims.

The Sponsor maintains insurance coverage against

potential losses that it believes is customary in its industry.

COERT currently maintains general liability insurance and excess liability

The Sponsor’s excess liability coverage and general liability insurance do not have deductibles.

The general liability

insurance covers the Sponsor and its subsidiaries for legal and contractual liabilities arising out of bodily injury or property damage,

including any resulting loss of use to third parties, and for sudden and accidental pollution or environmental liability, while the excess

liability coverage is in addition to and triggered if the general liability per occurrence limit is reached.

In addition, the Sponsor

maintains control of well insurance with per occurrence limits depending on the status of the well and deductibles consistent with industry

The Sponsor’s general liability insurance and excess liability policies do not provide coverage with respect to legal

and contractual liabilities of the Trust, and the Trust does not maintain such coverage since it is passive in nature and does not have

any ability to influence the Sponsor or control the operations or development of the Underlying Properties.

The Sponsor does not currently have any insurance

policies in effect that are intended to provide coverage for losses solely related to hydraulic fracturing operations, other than its

general liability and excess liability insurance policies that may cover third-party claims related to hydraulic fracturing operations

in accordance with, and subject to, the terms of such policies.

These policies may not cover fines, penalties or costs and expenses related

to government-mandated cleanup of pollution.

In addition, these policies do not provide coverage for all liabilities, and the insurance

coverage may not be adequate to cover claims that may arise;

moreover, the Sponsor may not be able to maintain adequate insurance at

rates it considers reasonable.

The occurrence of an event not fully covered by insurance could result in a significant decrease in the

amount of cash available for distribution by the Trust.

The Trust does not maintain any type of insurance against any of the risks of

conducting oil and gas exploration and production, hydraulic fracturing operations, or related activities.

Sponsor maintains insurance coverage against potential losses that it believes is customary in its industry.

The Sponsor currently

maintains general liability insurance and excess liability coverage.

The Sponsor’s excess liability coverage and general liability

insurance do not have deductibles.

The general liability insurance covers the Sponsor and its subsidiaries for legal and contractual liabilities

arising out of bodily injury or property damage, including any resulting loss of use to third parties, and for sudden and accidental pollution

or environmental liability, while the excess liability coverage is in addition to and triggered if the general liability per occurrence

limit is reached.

In addition, the Sponsor maintains control of well insurance with per occurrence limits depending on the status of the

well and deductibles consistent with industry standards.

The Sponsor’s general liability insurance and excess liability policies

do not provide coverage with respect to legal and contractual liabilities of the Trust, and the Trust does not maintain such coverage

since it is passive in nature and does not have any ability to influence the Sponsor or control the operations or development of the Underlying

Sponsor does not currently have any insurance policies in effect that are intended to provide coverage for losses solely related

to hydraulic fracturing operations, other than its general liability and excess liability insurance policies that may cover third-party

claims related to hydraulic fracturing operations in accordance with, and subject to, the terms of such policies.

These policies may not

cover fines, penalties or costs and expenses related to government-mandated cleanup of pollution.

In addition, these policies do not provide

coverage for all liabilities, and the insurance coverage may not be adequate to cover claims that may arise;

moreover, the Sponsor may

not be able to maintain adequate insurance at rates it considers reasonable.

The occurrence of an event not fully covered by insurance

could result in a significant decrease in the amount of cash available for distribution by the Trust.

The Trust does not maintain any

type of insurance against any of the risks of conducting oil and gas exploration and production, hydraulic fracturing operations, or related

Sponsor’s ability to perform its obligations to the Trust could be limited by restrictions under its debt agreements .

The Sponsor has various contractual obligations

to the Trust under the Trust Agreement and Conveyance.

Restrictions under the Sponsor’s debt agreements, including certain

covenants, financial ratios and tests, could impair its ability to fulfill its obligations to the Trust.

The requirement that the

Sponsor comply with these restrictive covenants and financial ratios and tests may materially adversely affect its ability to react to

changes in market conditions, take advantage of business opportunities it believes to be desirable, obtain future financing, fund needed

capital expenditures or withstand a continuing or future downturn in its business which may, in turn, impair the Sponsor’s operations

and its ability to perform its obligations to the Trust under the Trust Agreement and Conveyance.

If the Sponsor is unable to perform

its obligations to the Trust under the Trust Agreement or Conveyance, it could have a material adverse effect on the Trust.

The bankruptcy of the Sponsor or any of

the third-party operators could impede the operation of the wells and the development of the proved undeveloped reserves.

The value of the Net Profits Interest and the

Trust’s ultimate cash available for distribution is highly dependent on the financial condition of the operators of the Underlying

None of the operators of the Underlying Properties, including the Sponsor, has agreed with the Trust to maintain a certain

net worth or to be restricted by other similar covenants.

The ability to develop and operate the Underlying

Properties depends on the future financial condition and economic performance and access to capital of the operators of those properties,

which in turn will depend upon the supply and demand for oil and natural gas, prevailing economic conditions and financial, business

and other factors, many of which are beyond the control of the Sponsor and the third party operators.

Reduced demand for crude oil in

the global market could have a negative impact on the financial condition and economic performance of one or more of the operators of

the Underlying Properties.

The Sponsor is not a reporting company and is not required to file periodic reports with the SEC pursuant

to the Exchange Act.

Therefore, Trust unitholders do not have access to financial information about the Sponsor.

Sponsor has various contractual obligations to the Trust under the Trust Agreement and Conveyance.

Restrictions under the

Sponsor’s debt agreements, including certain covenants, financial ratios and tests, could impair its ability to fulfill its obligations

to the Trust.

The requirement that the Sponsor comply with these restrictive covenants and financial ratios and tests may materially

adversely affect its ability to react to changes in market conditions, take advantage of business opportunities it believes to be desirable,

obtain future financing, fund needed capital expenditures or withstand a continuing or future downturn in its business which may, in turn,

impair the Sponsor’s operations and its ability to perform its obligations to the Trust under the Trust Agreement and Conveyance.

If the Sponsor is unable to perform its obligations to the Trust under the Trust Agreement or Conveyance, it could have a material adverse

effect on the Trust.

The bankruptcy of the Sponsor or any of the

third-party operators could impede the operation of the wells and the development of the proved undeveloped reserves.

value of the Net Profits Interest and the Trust’s ultimate cash available for distribution is highly dependent on the financial

condition of the operators of the Underlying Properties.

None of the operators of the Underlying Properties, including the Sponsor,

has agreed with the Trust to maintain a certain net worth or to be restricted by other similar covenants.

ability to develop and operate the Underlying Properties depends on the future financial condition and economic performance and access

to capital of the operators of those properties, which in turn will depend upon the supply and demand for oil and natural gas, prevailing

economic conditions and financial, business and other factors, many of which are beyond the control of the Sponsor and the third

party operators.

Reduced demand for crude oil in the global market could have a negative impact on the financial condition and economic

performance of one or more of the operators of the Underlying Properties.

The Sponsor is not a reporting company and is not required to

file periodic reports with the SEC pursuant to the Exchange Act.

Therefore, Trust unitholders do not have access to financial information

about the Sponsor.

In the event of any future bankruptcy of any operator

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and the operations of the affected wells.

The working interest owners may not be able to find a replacement driller or operator, and

they may not be able to enter into a new agreement with such replacement party on favorable terms within a reasonable period.

The working interest owners may not be able to find a replacement driller or operator, and they

may not be able to enter into a new agreement with such replacement party on favorable terms within a reasonable period.

such a bankruptcy may result in reduced production from the reserves and decreased distributions to Trust unitholders, and could adversely

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with respect to the Net Profits Interest attributable to properties in Louisiana and New Mexico.

The Sponsor and the Trust believe that, in a bankruptcy

of the Sponsor, the Net Profits Interest would be viewed as a separate property interest under Texas law and, as such, outside of the

Sponsor’s bankruptcy estate.

However, if the bankruptcy court were to hold otherwise, or if Louisiana or New Mexico law were held

to be applicable, the Net Profits Interest might be considered an asset of the bankruptcy estate and used to satisfy obligations to creditors

of the Sponsor, in which case the Trust would be an unsecured creditor of the Sponsor at risk of losing the entire value of the Net Profits

Interest to senior creditors.

Sponsor and the Trust believe that, in a bankruptcy of the Sponsor, the Net Profits Interest would be viewed as a separate property

interest under Texas law and, as such, outside of the Sponsor’s bankruptcy estate.

However, if the bankruptcy court were to hold

otherwise, or if Louisiana or New Mexico law were held to be applicable, the Net Profits Interest might be considered an asset of the

bankruptcy estate and used to satisfy obligations to creditors of the Sponsor, in which case the Trust would be an unsecured creditor

of the Sponsor at risk of losing the entire value of the Net Profits Interest to senior creditors.

RISKS RELATED TO THE STRUCTURE OF THE TRUST

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the Trustee nor the Trust unitholders have any ability to influence the Sponsor or control the operations or development of the Underlying

The Trust Units are a passive investment that

entitles the Trust unitholders to only receive cash distributions derived from the Net Profits Interest.

Trust unitholders have no voting

rights with respect to the Sponsor and, therefore, have no managerial, contractual or other ability to influence the Sponsor’s

or the third-party operators’

The Trust Units are a passive investment that entitles

the Trust unitholders to only receive cash distributions derived from the Net Profits Interest.

Trust unitholders have no voting rights

with respect to the Sponsor and, therefore, have no managerial, contractual or other ability to influence the Sponsor’s or the third-party

operators’

activities or the operations of the Underlying Properties.

Oil and natural gas properties are typically

managed pursuant to an operating agreement among the working interest owners of oil and natural gas properties.

Third party operators

operate substantially all of the wells on the Underlying Properties.

The typical operating agreement contains procedures whereby the

owners of the working interests in the property designate one of the interest owners to be the operator of the property.

arrangements, the operator is typically responsible for making all decisions relating to drilling activities, sale of production, compliance

with regulatory requirements and other matters that affect the property.

Neither the Trustee nor the Trust unitholders have any contractual

ability to influence or control the field operations of, sale of oil or natural gas from, or any future development of, the Underlying

The current operators developing the Underlying Properties are under no obligations to continue operations on the Underlying

Neither the Trustee nor the Trust unitholders have the right to replace an operator.

Oil and natural gas properties are typically managed pursuant

to an operating agreement among the working interest owners of oil and natural gas properties.

Third party operators operate substantially

all of the wells on the Underlying Properties.

The typical operating agreement contains procedures whereby the owners of the working interests

in the property designate one of the interest owners to be the operator of the property.

Under these arrangements, the operator is typically

responsible for making all decisions relating to drilling activities, sale of production, compliance with regulatory requirements and

other matters that affect the property.

Neither the Trustee nor the Trust unitholders have any contractual ability to influence or control

the field operations of, sale of oil or natural gas from, or any future development of, the Underlying Properties.

The current operators

developing the Underlying Properties are under no obligations to continue operations on the Underlying Properties.

Neither the Trustee

nor the Trust unitholders have the right to replace an operator.

Subject to specified limitations, the Sponsor

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Trust unitholders will not be entitled to vote on any

transfer or abandonment of the Underlying Properties, and the Trust will not receive any net proceeds from any such transfer, except

in the limited circumstances when the Net Profits Interest is released in connection with such transfer, in which case the Trust will

receive an amount equal to the fair market value (net of sales costs) of the Net Profits Interest released.

Following any sale or transfer

of any of the Underlying Properties, if the Net Profits Interest is not released in connection with such sale or transfer, the Net Profits

transfer or abandonment of the Underlying Properties, and the Trust will not receive any net proceeds from any such transfer, except in

the limited circumstances when the Net Profits Interest is released in connection with such transfer, in which case the Trust will receive

an amount equal to the fair market value (net of sales costs) of the Net Profits Interest released.

Following any sale or transfer of

any of the Underlying Properties, if the Net Profits Interest is not released in connection with such sale or transfer, the Net Profits

Interest will continue to burden the transferred property and net profits attributable to such property will be calculated as part of

the computation of net profits.

The Sponsor may delegate to the transferee responsibility for all of the Sponsor’s obligations

relating to the Net Profits Interest on the portion of the Underlying Properties transferred.

The Sponsor may delegate to the transferee responsibility for all of the Sponsor’s obligations relating

to the Net Profits Interest on the portion of the Underlying Properties transferred.

addition, the Sponsor may, without the consent of the Trust unitholders, require the Trustee to release the Net Profits Interest associated

with any lease that accounts for no more than 0.25% the total production from the Underlying Properties in the prior 12 months, provided

that the Net Profits Interest covered by such releases cannot exceed , during any 12-month period, an aggregate fair market value

with any lease that accounts for no more than 0.25% of the total production from the Underlying Properties in the prior 12 months ,

provided that the Net Profits Interest covered by such releases cannot exceed, during any 12-month period, an aggregate fair market value

to the Trust of $500,000.

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non-cash flowing acreage to a private oil company, free and clear of the Net Profits Interest, as permitted under the Trust Agreement.

The proceeds from this sale attributable to the Trust’s Net Profits Interest were included in the distribution that was paid to

Trust unitholders on August 14, 2023.

The third-party operators and the Sponsor may

enter into farm-out, operating, participation and other similar agreements to develop the property without the consent or approval of

the Trustee or any Trust unitholder.

The third-party operators and the Sponsor may enter

into farm-out, operating, participation and other similar agreements to develop the property without the consent or approval of the Trustee

or any Trust unitholder.

Under certain circumstances, the Trustee

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and dissolve the Trust if the holders of at least 75% of the outstanding Trust Units approve the sale or vote to dissolve the Trust.

The Trustee must also sell the Net Profits Interest and dissolve the Trust if the annual cash proceeds received by the Trust attributable

Trustee must also sell the Net Profits Interest and dissolve the Trust if the annual cash proceeds received by the Trust attributable

to the Net Profits Interest are less than $2 million for each of any two consecutive years.

The net profits of any such sale will be

distributed to the Trust unitholders.

The net profits of any such sale will be distributed

to the Trust unitholders;

however, Trust unitholders may not recover their investment in the Trust Units.

Conflicts of interest could arise between

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As working interest owners in, and the operators

of certain wells on, the Underlying Properties, the Sponsor and its affiliates could have interests that conflict with the interests

of the Trust and the Trust unitholders.

The Sponsor’s

interests may conflict with those of the Trust and the Trust unitholders in situations involving

the development, maintenance, operation or abandonment of certain wells on the Underlying

Properties for which the Sponsor acts as the operator.

The Sponsor also may make decisions

with respect to development expenses that adversely affect the Underlying Properties.

decisions include reducing development expenses on properties for which the Sponsor acts

as the operator, which could cause oil and natural gas production to decline at a faster

rate and thereby result in lower cash distributions by the Trust in the future.

The Sponsor may sell

some or all the Underlying Properties without taking into consideration the interests of

the Trust unitholders.

of certain wells on, the Underlying Properties, the Sponsor and its affiliates could have interests that conflict with the interests of

the Trust and the Trust unitholders.

· The Sponsor’s interests may conflict with those of the Trust and the Trust unitholders in situations involving the development,

maintenance, operation or abandonment of certain wells on the Underlying Properties for which the Sponsor acts as the operator.

also may make decisions with respect to development expenses that adversely affect the Underlying Properties.

These decisions include

reducing development expenses on properties for which the Sponsor acts as the operator, which could cause oil and natural gas production

to decline at a faster rate and thereby result in lower cash distributions by the Trust in the future.

· The Sponsor may sell some or all the Underlying Properties without taking into consideration the interests of the Trust unitholders.

Such sales may not be in the best interests of the Trust unitholders.

These purchasers may lack the Sponsor’s experience or its creditworthiness.

also has the right, under certain circumstances, to cause the Trustee to release all or a

portion of the Net Profits Interest in connection with a sale of a portion of the Underlying

Properties to which such Net Profits Interest relates.

In such an event, the Trust is entitled

to receive the fair value (net of sales costs) of the Net Profits Interest released.

The Sponsor may sell

its Trust Units without considering the effects such sale may have on Trust Unit prices or

on the Trust itself.

Additionally, the Sponsor can vote its Trust Units in its sole discretion

without considering the interests of the other Trust unitholders.

The Sponsor is not a fiduciary

with respect to the Trust unitholders or the Trust and does not owe any fiduciary duties

or liabilities to the Trust unitholders or the Trust.

These purchasers may lack the Sponsor’s experience or its

creditworthiness.

The Sponsor also has the right, under certain circumstances, to cause the Trustee to release all or a portion of the

Net Profits Interest in connection with a sale of a portion of the Underlying Properties to which such Net Profits Interest relates.

such an event, the Trust is entitled to receive the fair value (net of sales costs) of the Net Profits Interest released.

· The Sponsor may sell its Trust Units without considering the effects such sale may have on Trust Unit prices or on the Trust itself.

Additionally, the Sponsor can vote its Trust Units in its sole discretion without considering the interests of the other Trust unitholders.

The Sponsor is not a fiduciary with respect to the Trust unitholders or the Trust and does not owe any fiduciary duties or liabilities

to the Trust unitholders or the Trust.

The Trust is administered by a Trustee who

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appropriate action to enforce provisions of the Conveyance, Trust unitholders’

recourse would be limited to bringing a lawsuit

against the Trustee to compel the Trustee to take specified actions.

The Trust Agreement expressly limits a Trust unitholder’s

ability to directly sue the Sponsor or any other third party other than the Trustee.

As a result, Trust unitholders will not be able

to sue the Sponsor or any future owner of the Underlying Properties to enforce these rights.

Furthermore, the Conveyance provides that,

except as set forth in the Conveyance, the Sponsor will not be liable to the Trust for the manner in which it performs its duties in

operating the Underlying Properties as long as it acts without gross negligence or willful misconduct.

In addition, the Trust Agreement

provides that, to the fullest extent permitted by law, the Sponsor is not subject to fiduciary duties or liable for conflicts of interest

recourse would be limited to bringing a lawsuit against

the Trustee to compel the Trustee to take specified actions.

The Trust Agreement expressly limits a Trust unitholder’s ability to

directly sue the Sponsor or any other third party other than the Trustee.

As a result, Trust unitholders will not be able to sue the Sponsor

or any future owner of the Underlying Properties to enforce these rights.

Furthermore, the Conveyance provides that, except as set forth

in the Conveyance, the Sponsor will not be liable to the Trust for the manner in which it performs its duties in operating the Underlying

Properties as long as it acts without gross negligence or willful misconduct.

In addition, the Trust Agreement provides that, to the fullest

extent permitted by law, the Sponsor is not subject to fiduciary duties or liable for conflicts of interest principles.

Financial information of the Trust is not

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company,”

meaning that the outstanding Trust Units held by nonaffiliates had a value of less than $250 million at the end

of the Trust’s most recently completed second fiscal quarter.

As a smaller reporting company, the Trust is not required to comply

with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, meaning the Trust’s auditors are

not required to attest to the effectiveness of the Trust’s internal control over financial reporting.

As a result, investors

and others may be less comfortable with the effectiveness of the Trust’s internal controls and the risk that material weaknesses

or other deficiencies in internal controls go undetected may increase.

meaning that the outstanding Trust Units held by nonaffiliates had a value of less than $250 million at the end of

the Trust’s most recently completed second fiscal quarter.

As a smaller reporting company, the Trust is not required to comply with

the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, meaning the Trust’s auditors are not required

to attest to the effectiveness of the Trust’s internal control over financial reporting.

As a result, investors and others

may be less comfortable with the effectiveness of the Trust’s internal controls and the risk that material weaknesses or other

deficiencies in internal controls go undetected may increase.

In addition, as a smaller reporting company, the Trust takes advantage

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Consequently, it may be more challenging for investors to analyze the Trust’s

results of operations and financial prospects, as the information the Trust provides to Trust unitholders may be different from

what one might receive from other public companies in which one holds shares.

As a smaller reporting company, the Trust is not required

to provide this information.

results of operations and financial prospects, as the information the Trust provides to Trust unitholders may be different from what

one might receive from other public companies in which one holds shares.

As a smaller reporting company, the Trust is not required to

provide this information.

RISKS RELATED TO OWNERSHIP OF THE TRUST UNITS

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Price Requirement”).

Under NYSE rules, a company that is out of compliance with the Minimum Price Requirement has a cure

period of six months to regain compliance if it notifies the NYSE within 10 business days of receiving a deficiency notice of its intention

to cure the deficiency.

Under NYSE rules, a company that is out of compliance with the Minimum Price Requirement has a cure period

of six months to regain compliance if it notifies the NYSE within 10 business days of receiving a deficiency notice of its intention to

cure the deficiency.

A company may regain compliance if on the last trading day of any calendar month during the cure period the company

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on the last trading day of that month.

If at the expiration of the cure period, both a $1.00 closing share price on the last trading

day of the cure period and a $1.00 average closing share price over the 30-trading-day period ending on the last trading day of the cure

period are not attained, the NYSE will commence suspension and delisting procedures.

If delisted by the NYSE, a company’s shares

may be transferred to the over-the-counter (“OTC”) market, a significantly more limited market than the NYSE, which could

affect the market price, trading volume, liquidity and resale price of such shares.

Securities that trade on the OTC markets also typically

experience more volatility compared to securities that trade on a national securities exchange.

During the cure period, the company’s

shares would continue to trade on the NYSE, subject to compliance with other continued listing requirements.

The Trust has fallen out

of compliance with the Minimum Price Requirement in the past, most recently in 2020, and although the Trust was able to regain compliance

within the applicable grace period, the Trust may be unable to maintain compliance in the future and could again become subject to the

NYSE delisting procedures.

Over the 30-day trading period that ended March 20, 2024, the closing price of the Trust Units on the

NYSE ranged from a high of $1.68 on February 8, 2024 to a low of $1.33 on March 20, 2024.

T he Sponsor may sell Trust Units in the

public or private markets, and such sales could have an adverse impact on the trading price of the Trust Units.

If at the expiration of the cure period, both a $1.00 closing share price on the last trading day

of the cure period and a $1.00 average closing share price over the 30-trading-day period ending on the last trading day of the cure period

are not attained, the NYSE will commence suspension and delisting procedures.

If delisted by the NYSE, a company’s shares may be

transferred to the over-the-counter (“OTC”) market, a significantly more limited market than the NYSE, which could affect

the market price, trading volume, liquidity and resale price of such shares.

Securities that trade on the OTC markets also typically experience

more volatility compared to securities that trade on a national securities exchange.

During the cure period, the company’s shares

would continue to trade on the NYSE, subject to compliance with other continued listing requirements.

The Trust has fallen out of compliance

with the Minimum Price Requirement in the past, most recently in 2020, and although the Trust was able to regain compliance within the

applicable grace period, the Trust may be unable to maintain compliance in the future and could again become subject to the NYSE delisting

Over the 30-day trading period that ended March 18, 2025, the closing price of the Trust Units on the NYSE ranged from

a high of $1.55 on March 12, 2025 to a low of $1.395 on February 13, 2025.

The Sponsor may sell Trust Units in the public

or private markets, and such sales could have an adverse impact on the trading price of the Trust Units.

of March 18, 2025, the Sponsor holds an aggregate of 7,363,961 Trust Units.

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The amounts available for distribution

by the Trust vary in response to numerous factors outside the control of the Trust, including prevailing prices for sales of oil and

natural gas production from the Underlying Properties and the timing and amount of direct operating expenses and development expenses.

Consequently, the market price for the Trust Units may not necessarily be indicative of the value that the Trust would realize if it

sold the Net Profits Interest to a third-party buyer.

In addition, the market price may not necessarily reflect the fact that since the

assets of the Trust are depleting assets, a portion of each cash distribution paid with respect to the Trust Units should be considered

by investors as a return of capital, with the remainder being considered as a return on investment.

As a result, distributions made to

a Trust unitholder over the life of these depleting assets may not equal or exceed the purchase price paid by the Trust unitholder.

by the Trust vary in response to numerous factors outside the control of the Trust, including prevailing prices for sales of oil and natural

gas production from the Underlying Properties and the timing and amount of direct operating expenses and development expenses.

Consequently,

the market price for the Trust Units may not necessarily be indicative of the value that the Trust would realize if it sold the Net Profits

Interest to a third-party buyer.

In addition, the market price may not necessarily reflect the fact that since the assets of the Trust

are depleting assets, a portion of each cash distribution paid with respect to the Trust Units should be considered by investors as a

return of capital, with the remainder being considered as a return on investment.

As a result, distributions made to a Trust unitholder

over the life of these depleting assets may not equal or exceed the purchase price paid by the Trust unitholder.

Courts outside of Delaware may not recognize

the limited liability of the Trust unitholders provided under Delaware law.

Under the Delaware Statutory Trust Act, Trust

unitholders will be entitled to the same limitation of personal liability extended to stockholders of corporations for profit under the

General Corporation Law of the State of Delaware.

The courts in jurisdictions outside of Delaware, however, might not give effect to

such limitation.

Under the Delaware Statutory Trust Act, Trust unitholders

will be entitled to the same limitation of personal liability extended to stockholders of corporations for profit under the General Corporation

Law of the State of Delaware.

The courts in jurisdictions outside of Delaware, however, might not give effect to such limitation.

LEGAL, ENVIRONMENTAL AND REGULATORY RISKS

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and the imposition of substantial liabilities for pollution resulting from

example, the EPA has published regulations that impose more stringent emissions control requirements for oil and gas development and

production operations, which may require the Sponsor, its operators, or third-party contractors to incur additional expenses to control

air emissions from current operations and during new well developments by installing emissions control technologies and adhering to a

variety of work practice and other requirements.

In addition, in 2012 and 2016, the EPA adopted federal New Source Performance

Standards (“NSPS”) that require the reduction of volatile organic compound and sulfur dioxide emissions from certain

fractured and refractured natural gas wells for which well completion operations are conducted and further require that most wells use

reduced emission completions, also known as “green completions.”

These regulations also establish specific requirements limiting

emissions from production-related wet seal and reciprocating compressors, pumps, and from pneumatic controllers and storage vessels,

and for equipment leaks.

These NSPS apply to sources that are newly constructed or modified after the rules’

example, the EPA has published regulations that impose more stringent emissions control requirements for oil and gas development and production

operations, which may require the Sponsor, its operators, or third-party contractors to incur additional expenses to control air emissions

from current operations and during new well developments by installing emissions control technologies and adhering to a variety of work

practice and other requirements.

In addition, in 2012 and 2016, the EPA adopted federal New Source Performance Standards (“NSPS”) that

require the reduction of volatile organic compound and sulfur dioxide emissions from certain fractured and refractured natural gas wells

for which well completion operations are conducted and further require that most wells use reduced emission completions, also known as

“green completions.”

These regulations also establish specific requirements limiting emissions from production-related wet

seal and reciprocating compressors, pumps, and from pneumatic controllers and storage vessels, and for equipment leaks.

These NSPS apply

to sources that are newly constructed or modified after the rules’

applicability dates.

More recently, in December 2023 the EPA adopted a final rule that will directly regulate volatile organic compound and methane

emissions from new oil and gas sources and will require further reductions in emissions through its regulation of flaring, compressors,

pumps, storage vessels, process controllers, well completions and liquids unloading, and equipment leaks.

At the same time, the EPA adopted

emissions guidelines that will apply to existing oil and gas sources and that require reductions in volatile organic compound and methane

emissions that are largely equivalent to the requirements for new sources.

The existing source emissions guidelines are to be implemented

through state plans, with expected compliance dates for existing sources arriving in 2029.

More recently, in December 2023 the

EPA adopted a final rule that will directly regulate volatile organic compound and methane emissions from new oil and gas sources

and will require further reductions in emissions through its regulation of flaring, compressors, pumps, storage vessels, process controllers,

well completions and liquids unloading, and equipment leaks.

At the same time, the EPA adopted emissions guidelines that will apply to

existing oil and gas sources and that require reductions in volatile organic compound and methane emissions that are largely equivalent

to the requirements for new sources.

The existing source emissions guidelines are to be implemented through state plans, with expected

compliance dates for existing sources arriving in 2029.

Numerous governmental authorities, such as the

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release or contamination or whether the operations were in compliance with all applicable laws at the time those actions were taken.

Private parties, including the owners of properties upon which wells are drilled and facilities where petroleum hydrocarbons or wastes

are taken for reclamation or disposal, may also have the right to pursue legal actions to enforce compliance as well as to seek damages

for non-compliance with environmental laws and regulations or for personal injury or property damage.

In addition, the risk of accidental

spills or releases could expose the operators of the Underlying Properties to significant liabilities that could have a material adverse

effect on the operators’

businesses, financial condition and results of operations and could reduce the amount of cash available

for distribution to Trust unitholders.

Changes in environmental laws and regulations occur frequently, and any changes that result in

more stringent or costly operational control requirements or waste handling, storage, transport, disposal or cleanup requirements could

require the operators of the Underlying Properties to make significant expenditures to attain and maintain compliance and may otherwise

have a material adverse effect on their results of operations, competitive position or financial condition.

parties, including the owners of properties upon which wells are drilled and facilities where petroleum hydrocarbons or wastes are taken

for reclamation or disposal, may also have the right to pursue legal actions to enforce compliance as well as to seek damages for non-compliance

with environmental laws and regulations or for personal injury or property damage.

In addition, the risk of accidental spills or releases

could expose the operators of the Underlying Properties to significant liabilities that could have a material adverse effect on the operators’

businesses, financial condition and results of operations and could reduce the amount of cash available for distribution to Trust unitholders.

Changes in environmental laws and regulations occur frequently, and any changes that result in more stringent or costly operational control

requirements or waste handling, storage, transport, disposal or cleanup requirements could require the operators of the Underlying Properties

to make significant expenditures to attain and maintain compliance and may otherwise have a material adverse effect on their results of

operations, competitive position or financial condition.

The Trust will indirectly bear 80% of all costs

and expenses paid by the Sponsor, including those related to environmental compliance and liabilities associated with the Underlying

Properties, including costs and liabilities resulting from conditions that existed prior to the Sponsor’s acquisition of the Underlying

Properties unless such costs and expenses result from the operator’s negligence or misconduct.

In addition, as a result of the

increased cost of compliance, the operators of the Underlying Properties may decide to discontinue drilling.

and expenses paid by the Sponsor, including those related to environmental compliance and liabilities associated with the Underlying Properties,

including costs and liabilities resulting from conditions that existed prior to the Sponsor’s acquisition of the Underlying Properties

unless such costs and expenses result from the operator’s negligence or misconduct.

In addition, as a result of the increased cost

of compliance, the operators of the Underlying Properties may decide to discontinue drilling.

Neither the Sponsor nor the Trust is generally

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The operators of the

Underlying Properties may incur substantial costs and experience delays in order to maintain compliance with these existing laws and

regulations, and the Trust will bear an 80% share of these costs.

Underlying Properties may incur substantial costs and experience delays in order to maintain compliance with these existing laws and regulations,

and the Trust will bear an 80% share of these costs.

In addition, the operators’

costs of compliance may increase

if existing laws and regulations are revised or reinterpreted, or if new laws and regulations become applicable to their operations.

Such costs could have a material adverse effect on the operators’

business, financial condition and results of operations and reduce

the amount of cash received by the Trust in respect of the Net Profits Interest.

The operators of the Underlying Properties must also

comply with laws and regulations prohibiting fraud and market manipulations in energy markets.

To the extent the operators of the Underlying

Properties are shippers on interstate pipelines, they must comply with the tariffs of such pipelines and with federal policies related

to the use of interstate capacity, and such compliance costs will be borne in part by the Trust.

costs of compliance may increase if existing laws

and regulations are revised or reinterpreted, or if new laws and regulations become applicable to their operations.

Such costs could have

a material adverse effect on the operators’

business, financial condition and results of operations and reduce the amount of cash

received by the Trust in respect of the Net Profits Interest.

The operators of the Underlying Properties must also comply with laws and

regulations prohibiting fraud and market manipulations in energy markets.

To the extent the operators of the Underlying Properties are

shippers on interstate pipelines, they must comply with the tariffs of such pipelines and with federal policies related to the use of

interstate capacity, and such compliance costs will be borne in part by the Trust.

Laws and regulations governing exploration and

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emissions of “greenhouse gases”

could result in increased operating costs and reduced demand for the oil and natural gas

that the operators produce while the physical effects of climate change could disrupt their production and cause them to incur significant

could result in increased operating costs and reduced demand for the oil and natural gas that

the operators produce while the physical effects of climate change could disrupt their production and cause them to incur significant

costs in preparing for or responding to those effects.

In response to findings that emissions of carbon

dioxide, methane and other greenhouse gases (“GHGs”) may present an endangerment to public health and the environment, the

EPA has issued regulations to restrict emissions of greenhouse gases under existing provisions of the CAA.

In response to its 2009 finding that emissions

of carbon dioxide, methane and other greenhouse gases (“GHGs”) may present an endangerment to public health and the environment,

the EPA has issued regulations to restrict emissions of greenhouse gases under existing provisions of the CAA.

These regulations include

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and methane emissions standards for certain new, modified and reconstructed oil and gas sources –

as well as the EPA’s recently

adopted methane emissions guidelines for existing oil and gas sources.

The EPA also has adopted rules requiring the reporting of

GHG emissions from specified large greenhouse gas emission sources in the United States, as well as certain onshore oil and natural gas

production facilities, on an annual basis.

In addition to this direct regulation of oil and gas sources, the EPA has recently proposed

rules to implement the mandatory Waste Emissions Charge set forth in the Inflation Reduction Act of 2022 (“IRA”), which

will charge a fee based on the methane emissions from applicable facilities in the oil and gas sector starting in 2024.

The EPA has established pollution control standards

for oil and gas sources under the CAA.

In 2012 and 2016, the EPA adopted federal New Source Performance Standards (“NSPS”) that

require the reduction of volatile organic compound and sulfur dioxide emissions from certain fractured and refractured natural gas wells

for which well completion operations are conducted and further require that most wells use reduced emission completions, also known as

“green completions.”

These regulations also establish specific requirements limiting emissions from production-related wet

seal and reciprocating compressors, pumps, and from pneumatic controllers and storage vessels, and for equipment leaks.

These NSPS apply

to sources that are newly constructed or modified after the rules’

applicability dates.

More recently, in December 2023 the

EPA adopted a final rule that will directly regulate volatile organic compound and methane emissions from new oil and gas sources

and will require further emissions reductions through its regulation of flaring, compressors, pumps, storage vessels, process controllers,

well completions and liquids unloading, and equipment leaks.

At the same time, the EPA adopted emissions guidelines that will apply to

existing oil and gas sources and that require reductions in volatile organic compound and methane emissions that are largely equivalent

to the requirements for new sources.

The existing source emissions guidelines are to be implemented through state plans, with expected

compliance dates for existing sources arriving in 2029.

The IRA included new

Clean Air Act section 136(c) directing EPA to collect the Waste Emissions Charge from facilities in the oil and gas sector that

report more than 25,000 tons of carbon dioxide equivalent emissions in a calendar year.

The charge will first apply to methane emissions

from calendar year 2024.

The charge is determined by comparing actual reported methane emissions to statutorily established “methane

intensity figures”

that are based on gas production or throughput, with a charge assessed for every ton of methane emissions that

exceeds the facility’s allowable emissions based on the applicable methane intensity figure.

The charge will be $900 per ton for

2024 emissions and will increase to $1,200 and then $1,500 per ton in subsequent years.

The program includes key exemptions, most notably

a regulatory compliance exemption that applies to and exempts the emissions from facilities that are subject to and in complete compliance

with the EPA’s new or existing source methane requirements.

The EPA proposed new rules to implement the Waste Emissions Charge

program in January 2024.

as well as the EPA’s methane

emissions guidelines for existing oil and gas sources that were adopted in 2024.

The EPA also has adopted rules requiring the reporting

of GHG emissions from specified large greenhouse gas emission sources in the United States, as well as certain onshore oil and natural

gas production facilities, on an annual basis.

On January 20, 2025, President Trump announced

the withdrawal of the United States from the Paris Climate Agreement.

President Trump also issued an executive order directing the EPA

to review the legality and continuing applicability of its 2009 GHG endangerment finding.

The outcome of that review is not currently

however, it has the potential to eliminate the basis for the EPA’s regulation of GHGs under the CAA.

The EPA has established GHG standards for oil and

gas sources based on its endangerment finding.

In 2024, the EPA adopted a final rule that will directly regulate volatile organic

compound and methane emissions from new oil and gas sources and will require further emissions reductions through its regulation of flaring,

compressors, pumps, storage vessels, process controllers, well completions and liquids unloading, and equipment leaks.

At the same time,

the EPA adopted emissions guidelines that will apply to existing oil and gas sources and that require reductions in volatile organic compound

and methane emissions that are largely equivalent to the requirements for new sources.

The existing source emissions guidelines are to

be implemented through state plans, with expected compliance dates for existing sources arriving in 2029.

The Inflation Reduction

Act of 2022 (“IRA”) included new CAA section 136(c) directing EPA to collect the Waste Emissions Charge (“WEC”)

from facilities in the oil and gas sector that report more than 25,000 tons of carbon dioxide equivalent emissions in a calendar year.

The charge will first apply to methane emissions from calendar year 2024.

The charge is determined by comparing actual reported methane

emissions to statutorily established “methane intensity figures”

that are based on gas production or throughput, with a charge

assessed for every ton of methane emissions that exceeds the facility’s allowable emissions based on the applicable methane intensity

The charge will be $900 per ton for 2024 emissions and will increase to $1,200 and then $1,500 per ton in subsequent years.

program includes key exemptions, most notably a regulatory compliance exemption that applies to and exempts the emissions from facilities

that are subject to and in complete compliance with the EPA’s new or existing source methane requirements.

The EPA adopted new rules to

implement the WEC program in November 2024;

however, the fate of the WEC and the EPA rules implementing the WEC is unclear.

In February 2025, the United States House of Representatives and Senate both passed resolutions to repeal the EPA’s 2024 WEC

rules under the Congressional Review Act (“CRA”), and on March 14, 2025 President Trump signed the resolution repealing those rules under the CRA.

In addition, the United States House of Representatives and Senate may be considering amendment or repeal of certain portions of

the IRA, including the statutory provisions establishing the WEC.

Additionally, more than one-third of the states

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Although most of the state-level initiatives have to date focused on large sources of GHG

emissions, such as coal-fired electric plants, it is possible that smaller sources of emissions could become subject to GHG emission

limitations or allowance purchase requirements in the future.

In addition, from time to time Congress has considered adopting legislation

to reduce emissions of greenhouse gases.

Any one of these climate change regulatory and legislative initiatives could have a material

adverse effect on the Sponsor’s business, capital expenditures, financial condition and results of operations.

emissions, such as coal-fired electric plants, it is possible that smaller sources of emissions could become subject to GHG emission limitations

or allowance purchase requirements in the future.

For example, the states of Colorado and New Mexico have adopted rules regulating

GHGs from the oil and gas industry that are based on the federal standards.

In addition, Congress may consider adopting legislation to

reduce emissions of greenhouse gases.

Any one of these climate change regulatory and legislative initiatives could have a material adverse

effect on the Sponsor’s business, capital expenditures, financial condition and results of operations.

The adoption and implementation of regulations

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related to climate change could adversely affect the Trust.

On March 6, 2024, the SEC issued a final rule regarding

In March 2024, the SEC issued a final rule regarding

the enhancement and standardization of mandatory climate-related disclosures for investors.

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systems and resources of the Sponsor or the Trust or both.

The SEC’s climate disclosure requirements may change under the Trump

Administration.

In February 2025, the acting SEC Chair issued a statement that the SEC would not defend the 2024 disclosure rule in

court and that the SEC would revisit the 2024 rule.

The outcome of the SEC’s review may result in changes to SEC climate-related

disclosure requirements, but the outcome of that review is uncertain.

Even in the absence of federal requirements, however, some states

have adopted climate disclosure laws or rules that are not affected by the SEC’s review.

Finally, some scientists have theorized that increasing

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If any such significant physical effects were to occur,

they could have an adverse effect on the Sponsor’s assets and operations and cause the Sponsor to incur costs in preparing for

and responding to them.

Additionally, energy needs could increase or decrease as a result of extreme weather conditions, depending on

the duration and magnitude of those conditions.

they could have an adverse effect on the Sponsor’s assets and operations and cause the Sponsor to incur costs in preparing for and

responding to them.

Additionally, energy needs could increase or decrease as a result of extreme weather conditions, depending on the

duration and magnitude of those conditions.

Federal and state legislative and regulatory

initiatives relating to hydraulic fracturing could result in increased costs and additional operating restrictions or delays as well

as adversely affect the services of the operators of the Underlying Properties.

initiatives relating to hydraulic fracturing could result in increased costs and additional operating restrictions or delays as well as

adversely affect the services of the operators of the Underlying Properties.

Hydraulic fracturing is an important and common

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by state oil and gas commissions.

However, the EPA has asserted federal regulatory authority over hydraulic fracturing.

In December 2016

the EPA issued a final report on the potential impacts of hydraulic fracturing on drinking water resources.

The report did not find widespread,

systematic impacts to drinking water from hydraulic fracturing;

at the same time, the report acknowledged information gaps that limited

EPA’s ability to fully assess the potential impacts to drinking water resources.

2012 the EPA adopted federal NSPS that require the reduction of volatile organic compound emissions from certain fractured and refractured

natural gas wells for which well completion operations are conducted and further require that most wells use reduced emission completions,

also known as “green completions.”

These regulations also establish specific new requirements regarding emissions from production-related

wet seal and reciprocating compressors, and from pneumatic controllers and storage vessels.

In June 2016, the EPA adopted the Methane

Rule, which established requirements to control GHG emissions from oil and gas sources that are constructed, modified, or reconstructed

after September 18, 2015.

More recently, on November 15, 2021, the EPA published a proposed rule that would establish

emissions guidelines for the control of methane from existing oil and gas sources for the first time under the CAA.

The EPA intends to

adopt the existing source emissions guidelines as a final rule by the end of 2022, which would then trigger a requirement for states

to develop rules that will make the federal emissions guidelines enforceable as state rules over a three- to four-year period

The ultimate fate of the proposed methane emissions guidelines is unclear.

Nevertheless, regulations promulgated under the CAA may require

the Sponsor to incur development expenses to install and utilize specific equipment, technologies, or work practices to control emissions

from its operations, which could reduce the profits available to the Trust and potentially impair the economic development of the Underlying

However, several federal and local agencies have also adopted, or are considering adopting, regulations

that could further restrict or prohibit hydraulic fracturing in certain circumstances, impose more stringent operating standards

and/or require the disclosure of the composition of hydraulic fracturing fluids.

See “Item 1 Business —

Environmental

Matters and Regulation —

Hydraulic fracturing.”

Increased regulation and attention given to the hydraulic

fracturing process and associated processes could lead to greater opposition to, and litigation concerning, oil and natural gas production

activities using hydraulic fracturing techniques.

Additional legislation or regulation could also lead to operational delays

or increased operating costs in the production of oil and natural gas, including from developing shale plays, or could make it more difficult

to perform hydraulic fracturing.

The adoption of any federal, state or local laws or the implementation of regulations regarding hydraulic

fracturing could require the Sponsor or the third party operators to incur development expenses to install and utilize specific equipment,

technologies, or work practices to control emissions from their operations, which could reduce the profits available to the Trust and

potentially impair the economic development of the Underlying Properties.

Some states have adopted, and other states are

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then make such information publicly available.

Disclosure of chemicals used in the fracturing process could make it easier for third

parties opposing hydraulic fracturing to initiate legal proceedings against producers and service providers based on allegations that

specific chemicals used in the fracturing process could adversely affect groundwater.

In addition, if hydraulic fracturing is regulated

at the federal level, the Sponsor’s and the third party operators’

fracturing activities could become subject to additional

permit requirements or operational restrictions and also to associated permitting delays and potential increases in costs.

Disclosure of chemicals used in the fracturing process could make it easier for third parties

opposing hydraulic fracturing to initiate legal proceedings against producers and service providers based on allegations that specific

chemicals used in the fracturing process could adversely affect groundwater.

In addition, if hydraulic fracturing is regulated at the

federal level, the Sponsor’s and the third party operators’

fracturing activities could become subject to additional permit

requirements or operational restrictions and also to associated permitting delays and potential increases in costs.

In December 2014,

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Further, some local

governments, including in Texas, have imposed moratoria on drilling permits within city limits so that local ordinances may be reviewed

to assess their adequacy to address such activities.

Similar measures might be considered or implemented in the jurisdictions in which

the Underlying Properties are located.

If new laws or regulations that significantly

restrict or otherwise impact hydraulic fracturing are passed by Congress or adopted in Texas, Louisiana or New Mexico, such legal requirements

governments have imposed moratoria on drilling permits within city limits so that local ordinances may be reviewed to assess their adequacy

to address such activities.

Similar measures might be considered or implemented in the jurisdictions in which the Underlying Properties

If new laws or regulations that significantly restrict

or otherwise impact hydraulic fracturing are passed by Congress or adopted in Texas, Louisiana or New Mexico, such legal requirements

could make it more difficult or costly for the Sponsor or the third party operators to perform hydraulic fracturing activities and thereby

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Properties, and could increase the cycle times and costs to receive permits, delay or possibly preclude receipt of permits in certain

areas, impact water usage and waste water disposal and require air emissions, water usage and chemical additives disclosures.

areas, impact water usage and wastewater disposal and require air emissions, water usage and chemical additives disclosures.

CYBERSECURITY RISKS

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business operations.

In recent years, the Sponsor has increasingly

relied on information technology (“IT”) systems and networks in connection with its business activities, including certain

of its exploration, development and production activities.

The Sponsor relies on digital technology, including information systems and

related infrastructure, as well as cloud applications and services, to, among other things, estimate quantities of oil and natural gas

reserves, analyze seismic and drilling information, process and record financial and operating data and communicate with employees and

third parties.

As dependence on digital technologies has increased, cyber incidents, including deliberate attacks and attempts to gain

unauthorized access to computer systems and networks, have increased in frequency and sophistication.

These threats pose a risk to the

security of the Sponsor’s systems and networks, the confidentiality, availability and integrity of its data and the physical security

of its employees and assets.

Any cyber-attack could have a material adverse effect on the Sponsor’s reputation, competitive position,

business, financial condition and results of operations, and could have a material adverse effect on the Trust.

Cyber-attacks or security

breaches also could result in litigation or regulatory action, as well as significant additional expense to the Sponsor to implement

further data protection measures.

In recent years, the Sponsor has increasingly relied

on information technology (“IT”) systems and networks in connection with its business activities, including certain of its

exploration, development and production activities.

The Sponsor relies on digital technology, including information systems and related

infrastructure, as well as cloud applications and services, to, among other things, estimate quantities of oil and natural gas reserves,

analyze seismic and drilling information, process and record financial and operating data and communicate with employees and third parties.

As dependence on digital technologies has increased, cyber incidents, including deliberate attacks and attempts to gain unauthorized access

to computer systems and networks, have increased in frequency and sophistication.

These threats pose a risk to the security of the Sponsor’s

systems and networks, the confidentiality, availability and integrity of its data and the physical security of its employees and assets.

Any cyber-attack could have a material adverse effect on the Sponsor’s reputation, competitive position, business, financial condition

and results of operations, and could have a material adverse effect on the Trust.

Cyber-attacks or security breaches also could result

in litigation or regulatory action, as well as significant additional expense to the Sponsor to implement further data protection measures.

In addition to the risks presented to the Sponsor’s

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If a cyber-attack were to occur, it could potentially

jeopardize the confidential, proprietary and other information processed and stored in, and transmitted through, the Trustee’s

computer systems and networks, or otherwise cause interruptions or malfunctions in the operations of the Trust, which could result in

litigation, increased costs and regulatory penalties.

It is possible that a cyber incident will not be discovered for some time after

it occurs, which could increase exposure to these consequences.

jeopardize the confidential, proprietary and other information processed and stored in, and transmitted through, the Trustee’s computer

systems and networks, or otherwise cause interruptions or malfunctions in the operations of the Trust, which could result in litigation,

increased costs and regulatory penalties.

It is possible that a cyber incident will not be discovered for some time after it occurs, which

could increase exposure to these consequences.

TAX RISKS RELATED TO THE TRUST UNITS

3 unchanged sentences

is not a “grantor trust”

federal income tax purposes, the Trust could be subject to more complex and costly tax

reporting requirements that could reduce the amount of cash available for distribution to Trust unitholders.

federal income tax purposes, the Trust could be subject to more complex and costly tax reporting

requirements that could reduce the amount of cash available for distribution to Trust unitholders.

If the Trust were not treated as a grantor trust

10 unchanged sentences

(including applicable penalties and interest) as a result of an audit.

These rules effectively would impose an entity level tax

on the Trust, and unitholders may have to bear the expense of the adjustment even if they were not Trust unitholders during the audited

taxable year.

These rules effectively would impose an entity level tax on

the Trust, and unitholders may have to bear the expense of the adjustment even if they were not Trust unitholders during the audited taxable

Neither the Sponsor nor the Trustee has requested

7 unchanged sentences

Trust’s assets and receive the Trust’s income and are directly taxable thereon as if no Trust were in existence.

the Trust generates taxable income that could be different in amount than the cash the Trust distributes, Trust unitholders are required

to pay any U.S.

Trust generates taxable income that could be different in amount than the cash the Trust distributes, Trust unitholders are required to

federal income taxes and, in some cases, state and local income taxes on their share of the Trust’s taxable income

6 unchanged sentences

she will recognize a gain or loss equal to the difference between the amount realized and his or her tax basis in those Trust Units.

A substantial portion of any gain recognized may be taxed as ordinary income due to potential recapture items, including depletion recapture.

substantial portion of any gain recognized may be taxed as ordinary income due to potential recapture items, including depletion recapture.

The Trust allocates its items of income,

10 unchanged sentences

in an increase in the administrative expense of the Trust in subsequent periods.

Trust unitholders should consult their tax

advisors as to the specific tax consequences of the ownership and disposition of the of the Trust Units, including the applicability

and effect of U.S.

Trust unitholders should consult their tax advisors

as to the specific tax consequences of the ownership and disposition of the of the Trust Units, including the applicability and effect

federal, state, local, and foreign income and other tax laws in light of their particular circumstances.

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 1A. Risk Factors