Hugoton Royalty Trust is a passive statutory trust that holds net profits interests (NPIs) in natural gas and oil producing properties across Kansas, Oklahoma, and Wyoming. The Trust owns 80% NPIs in the underlying properties, entitling it to 80% of net proceeds after deducting production taxes, operating costs, development costs, and overhead. The Trust has no employees and conducts no operations — it simply collects income from the underlying properties and distributes that cash to unitholders monthly. Mach Natural Resources (which acquired the properties from XTO Energy, a subsidiary of ExxonMobil, in April 2025) operates the underlying properties. The Trust's distributions are driven primarily by natural gas prices, production volumes, and operating costs charged by the working interest owner. If costs exceed revenues for any state conveyance in a given month, those excess costs carry forward with interest and must be recovered from future proceeds before the Trust receives payment. Because the Trust holds depleting assets and cannot acquire new ones, distributions are expected to decline over time as production falls. There is also a seasonal element, as natural gas demand tends to be higher in winter, leading to higher distributions in those months. The Trustee, currently Argent Trust Company, collects income, pays Trust expenses, and distributes the remainder to unitholders.