Permian Basin (NYSE: PBT) secures $9M royalty settlement with operator

Rhea-AI Filing Summary

Permian Basin Royalty Trust entered into a material settlement agreement with Blackbeard Operating, LLC on August 19, 2025 resolving litigation related to royalties from Waddell Ranch properties. Under the agreement, Blackbeard will pay the Trust $9,000,000, with $4,500,000 due within 30 days and four additional quarterly installments of $1,125,000 each during the 2026 calendar year.

The settlement also sets an agreed overhead rate, allows pass-through of certain third-party charges for salt water disposal, gathering and transportation, and permits technical labor charges using a defined allocation method against the net overriding royalty. The Trust agreed not to pursue future claims for lost volumes in cases of ordinary line loss, while gaining the option to conduct annual site audits at its expense and receiving enhanced reporting from Blackbeard.

Positive

• $9,000,000 settlement payment from Blackbeard, including $4,500,000 within 30 days and four quarterly installments of $1,125,000 during 2026, strengthens near-term cash inflows.
• Clearer cost and reporting framework with defined overhead rates, allowed pass-through charges, audit rights, and enhanced reporting reduces uncertainty around future royalty calculations.

Negative

• None.

Insights

Energy income & royalty trust analyst

$9M settlement boosts cash inflow and clarifies cost-sharing terms.

Permian Basin Royalty Trust secured a settlement where Blackbeard Operating will pay $9,000,000 tied to disputed royalty calculations on Waddell Ranch properties. The structure provides near-term liquidity via a $4,500,000 payment within 30 days, followed by four quarterly installments of $1,125,000 throughout 2026, which can support future distributions depending on the Trust’s broader cash needs and policies.

Beyond the cash, the agreement formalizes how overhead, salt water disposal, gathering and transportation, and certain technical labor can be charged against the 75% net overriding royalty. It also limits future claims related to ordinary line loss but gives the Trust annual site audit rights and enhanced reporting. Overall, this reduces uncertainty around both past and future royalty calculations, though the long-term impact will depend on ongoing production levels and how the new cost framework affects net royalties.

8-K Event Classification

3 items: 1.01, 8.01, 9.01

3 items

Item 1.01 Entry into a Material Definitive Agreement Business

The company signed a significant contract such as a merger agreement, credit facility, or major partnership.

Item 8.01 Other Events Other

Voluntary disclosure of events the company deems important to shareholders but not covered by other items.

Item 9.01 Financial Statements and Exhibits Exhibits

Financial statements, pro forma financial information, and exhibit attachments filed with this report.

Understanding 8-K Material Events →

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report: August 19, 2025

PERMIAN BASIN ROYALTY TRUST

(Exact name of Registrant as Specified in Its Charter)

Texas			1-8033	75-6280532
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
Argent Trust Company 3838 Oak Lawn Ave. Suite 1720
Dallas, Texas				75219
(Address of Principal Executive Offices)				(Zip Code)

Registrant’s Telephone Number, Including Area Code: 855 588-7839

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Units of Beneficial Interest		PBT		New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01 Entry into a Material Definitive Agreement.

On August 19, 2025, Argent Trust Company, as trustee (“Trustee”) of Permian Basin Royalty Trust (the “Trust”), entered into a settlement agreement and release (the “Settlement Agreement”) in connection with its lawsuit against Blackbeard Operating, LLC (“Blackbeard”), the operator of the of properties in the Waddell Ranch, in Crane County, Texas, in which the Trust holds a 75% net overriding royalty. Pursuant to the lawsuit, the Trustee had sought to recover more than $9 million in damages it alleged resulted from Blackbeard’s failure to properly calculate and pay royalties due and owing to the Trust.

Pursuant to the Settlement Agreement, Blackbeard has agreed to pay the Trust $9,000,000, of which $4,500,000 will be paid to the Trust within 30 days, and the remainder of which will be paid in four equal installments of $1,125,000 quarterly during the 2026 calendar year.

Additionally, the Settlement Agreement established the overhead rate that may be charged to the Trust and permits Blackbeard to pass through third-party charges for salt water disposal and gathering and transportation, and charge technical labor on reservoir engineers using an agreed allocation methodology against the net overriding royalty. The parties also agreed that the Trust would not make future claims for lost volumes in the case of ordinary line loss (as defined by third party purchase agreements with purchasers). The Trust will have the option to conduct annual site audits, at its expense. The Settlement Agreement also set forth agreed reporting that Blackbeard will provide the Trustee going forward.

The foregoing description of the Settlement Agreement does not purport to be complete and is qualified in its entirety by reference to the Settlement Agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated herein by reference.

Item 8.01 Other Events.

On August 19, 2025, the Trust issued a press release announcing that the Trustee entered into the Settlement Agreement.

A copy of the press release is attached hereto as Exhibit 99.1.

Item 9.01 Financial Statements and Exhibits.

Exhibit No.		Description
10.1		Settlement Agreement and Release dated August 19, 2025, by and between Argent Trust Company, as Trustee of the Permian Basin Royalty Trust, and Blackbeard Operating, LLC
99.1		Press Release dated August 19, 2025

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

			PERMIAN BASIN ROYALTY TRUST
		By:	ARGENT TRUST COMPANY, TRUSTEE
		By:	/s/ Jana Egeler
Date: August 19, 2025			Jana Egeler Vice President and Trust Administrator

FAQ

What did Permian Basin Royalty Trust (PBT) announce in this 8-K?

The Trust reported that Argent Trust Company, as trustee, entered into a Settlement Agreement with Blackbeard Operating, LLC on August 19, 2025, resolving litigation related to royalty payments from Waddell Ranch properties.

How much will Permian Basin Royalty Trust (PBT) receive under the Blackbeard settlement?

Blackbeard agreed to pay the Trust a total of $9,000,000, with $4,500,000 payable within 30 days and four quarterly installments of $1,125,000 each during the 2026 calendar year.

How is the $9 million settlement payment to Permian Basin Royalty Trust structured?

The payment consists of an initial $4,500,000 due to the Trust within 30 days of the agreement date, followed by four equal payments of $1,125,000 each, to be made quarterly during 2026.

What operating cost terms were included in the Permian Basin Royalty Trust settlement with Blackbeard?

The agreement set an overhead rate that may be charged to the Trust, permits Blackbeard to pass through third-party salt water disposal and gathering and transportation charges, and allows technical labor charges on reservoir engineers using an agreed allocation methodology.

Does the settlement change how Permian Basin Royalty Trust can pursue future claims?

Yes. The Trust agreed it will not make future claims for lost volumes in the case of ordinary line loss, as defined by third-party purchase agreements, while gaining rights to conduct annual site audits at its expense and receive specified reporting from Blackbeard.

What exhibits were filed with this Permian Basin Royalty Trust 8-K?

The filing includes Exhibit 10.1, the Settlement Agreement and Release dated August 19, 2025 between the Trustee and Blackbeard Operating, LLC, and Exhibit 99.1, a press release dated the same day.