Company: GULTU
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001641172-25-001201
Chunk: 10

Company: Gulf Coast Ultra Deep Royalty Trust
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1A
Chunk 10
---
23  

  Disclose the amount of compensation                                                                                            
  Send monthly statements to                                                                                                     
  In some circumstances, approve                                                                                                 

Consequently,
penny stock rules and FINRA rules may restrict the ability or willingness of broker-dealers to trade and/or maintain a market in the
Royalty Trust units. Also, prospective investors may not want to get involved with the additional administrative requirements, which
may have a material adverse effect on the trading of the Royalty Trust units.

Risks
Related to the Royalty Trust Structure

The
Royalty Trust is dependent on HOGA for funding unless royalty income from production on the onshore Highlander subject interest is sufficient
to cover the Royalty Trust’s administrative expenses.

Pursuant
to the Royalty Trust Agreement, the Depositor has agreed to pay annual trust expenses up to a maximum amount of $350,000, with no right
of repayment or interest due, to the extent the Royalty Trust lacks sufficient funds to pay administrative expenses. On February 1, 2024,
pursuant to this provision, FCX contributed approximately $166,000 for the payment of trust expenses incurred during the year ended December
31, 2023, and contributed the maximum of $350,000 for the payment of trust expenses incurred during the year ended December 31, 2024.
In addition to such annual contributions, the Depositor has agreed to lend money, on an unsecured, interest-free basis, to the Royalty
Trust to fund the Royalty Trust’s ordinary administrative expenses as set forth in the Royalty Trust Agreement. All funds the Trustee
borrows to cover expenses or liabilities, whether from the Depositor or from any other source, must be repaid before the Royalty Trust
unitholders will receive any distributions. FCX loaned the Royalty Trust $200,000 during the year ended December 31, 2024. No loans or
repayments were made during the year ended December 31, 2023. Pursuant to the Assignment, as of December 31, 2024, FCX assigned to HOGA
the promissory note relating to the outstanding loan to the Royalty Trust. To the extent annual trust expenses exceed $350,000, the Royalty
Trust may be required to borrow funds from HOGA in the future.

Pursuant
to the Royalty Trust Agreement, the Depositor also agreed to provide and maintain a $1.0 million stand