Company: MTR
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001104659-25-029944
Chunk: 40

Company: MESA ROYALTY TRUST/TX
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 40
---
 which could ultimately result in the termination of the Trust if the remaining Royalty does not generate sufficient income to maintain the $250,000 threshold. No assurances can be made that any such sale will be on terms acceptable to all unitholders. The sale of the remaining Royalty interests and the termination of the Trust would be taxable events to the Trust unitholders.

22

TABLE OF CONTENTS

Unitholders have limited voting rights.

Voting rights as a unitholder are more limited than those of stockholders of most public corporations. For example, there is no requirement for annual meetings of unitholders or for an annual or other periodic re-election of the Trustee. Additionally, Trust unitholders have no voting rights in any of the Working Interest Owners. Unlike corporations which are generally governed by boards of directors elected by their equity holders, the Trust is administered by a corporate Trustee in accordance with the Trust Indenture and other organizational documents. The Trustee has extremely limited discretion in its administration of the Trust.

Unitholders have limited ability to enforce the Trust’s rights against the current or future owners of the Royalty Properties.

The Trust Indenture and related trust law permit the Trustee and the Trust to sue the Working Interest Owners to compel them to fulfill the terms of the Conveyance of the Royalty. If the Trustee does not take appropriate action to enforce provisions of the Conveyance, the Trust Indenture limits and conditions the rights of the unitholders to assert any claims against the Trustee. Unitholders have limited ability to enforce the Trust’s rights against a Working Interest Owner.

The limited liability of the Trust unitholders is uncertain.

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