Permian Basin Royalty Trust is a passive oil and gas royalty trust that collects royalty income from properties in Texas and distributes that income to unit holders monthly. The Trust holds two royalty interests: a 75% net overriding royalty interest in the Waddell Ranch properties in Crane County, Texas, operated by Blackbeard Operating, and a 95% net overriding royalty interest in royalty properties elsewhere in Texas, managed by Riverhill Energy. The Trust has no employees, conducts no operations, and cannot acquire new assets. Argent Trust Company serves as Trustee, collecting royalty income, paying Trust expenses, and distributing the remainder to unit holders. The Trust earns income by receiving a fixed percentage of net proceeds — gross revenues from production minus production costs — from the underlying properties. Because costs are deducted before the Trust receives anything, distributions are driven by production volumes, oil and gas prices, and operator spending. If costs exceed revenues in any period, the shortfall carries forward and must be recovered before the Trust receives further payments. The Trust's asset base is fixed, meaning production and distributions will decline over time as the underlying properties deplete. The Trust is structured as a pass-through entity for U.S. federal tax purposes, so income flows directly to unit holders and is taxed at the individual level.