Attached files
file | filename |
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8-K - FORM 8-K - TORCH ENERGY ROYALTY TRUST | h79930e8vk.htm |
EX-99.2 - EX-99.2 - TORCH ENERGY ROYALTY TRUST | h79930exv99w2.htm |
Exhibit 99.1
NEWS RELEASE
FOR IMMEDIATE RELEASE
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Contact: | |||
February 23, 2011
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Investor Relations (800) 536-7453 |
Torch Energy Royalty Trust and Derivative Unitholder Plaintiff reach a settlement with
Constellation Energy Partners LLC
HOUSTON Torch Energy Royalty Trust (Trust) (NYSE: TRU) (www.torchroyalty.com) today announced
that the Trust and the derivative unitholder plaintiff have reached an agreement in principle with
Constellation Energy Partners LLC to settle litigation filed by the derivative plaintiff on the
Trusts behalf, captioned Trust Venture Company, LLC v. Constellation Energy Partners LLC
(CV-2008-900751), in the Circuit Court of Tuscaloosa County, Alabama. The settlement agreement is
subject to approval of the Court, and the Trust estimates that the process for approval will take
approximately 60 days.
Under the proposed settlement, the derivative plaintiff and the Trust have agreed to settle the
claims against Constellation Energy Partners LLC (CEP) in the derivative action, and to enter
into mutual, general releases with CEP in return for (i) a payment of one million two hundred
thousand United States dollars ($1,200,000) to the derivative plaintiff by Robinsons Bend
Production II (RBP II), which is a Delaware limited liability company and an affiliate of CEP, to
reimburse the derivative plaintiff for the legal fees and expenses it incurred in prosecuting the
derivative action, (ii) an irrevocable bid by RBP II of not less than one million United States
dollars ($1,000,000) for its purchase from the Trust of the net overriding royalty interest
(Alabama NORRI), when such Alabama NORRI is separately offered for sale by the Trust at public
auction within 180 days of the effective date of the settlement, with such bid amount to be
deposited by RBP II in a third-party escrow account pending the public auction, and (iii) a third
amendment to that certain Water Gathering and Disposal Agreement providing that, for a period of
ten years commencing on the first day of the month following the effective date of the settlement,
the charges for the gathering, separation, and disposal of water from oil and gas wells located in
Tuscaloosa County, Alabama that are owned and operated by RBP II (Wells) shall be fifty-three
cents ($0.53) per barrel of water. (RBP II currently charges one United States dollar ($1.00) per
barrel of water for the gathering, separation, and disposal of such water from the Wells.)
The Court has set a settlement hearing in the Alabama Circuit Court, Tuscaloosa County, 714
Greensboro Avenue, Tuscaloosa, Alabama 35401, on April 11, 2011, at 2:00 p.m. CDT. At the
settlement hearing, the Court will determine whether or not (i) to approve the Settlement as
memorialized in the proposed Settlement and Release Agreement with CEP, and (ii) to approve an
Order ending the derivative action.
Additional information about the lawsuit and settlement can be found in the Trusts filings with
the Securities and Exchange Commission and on the Trusts Web site www.torchroyalty.com.
About the Trust
The Trusts underlying properties are depleting assets consisting of net overriding royalty
interests in proved developed oil and gas properties located in Texas, Alabama and Louisiana and
approximately 99% of the estimated reserves are gas.
Forward-Looking Statements
This press release may contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 with respect to the Trusts business that is not
historical information. As a general matter, forward-looking statements are those focused upon
future or anticipated events or trends and expectations and beliefs relating to matters that are
not historical in nature. The words believe, expect, plan, intend, estimate, or
anticipate and similar expressions, as well as future or conditional verbs such as will,
should, would, and could, often identify forward-looking statements. The Trust believes
there is a reasonable basis for its expectations and beliefs, but they are inherently uncertain,
and the Trust may not realize its expectations and its beliefs may not prove correct, including,
without limitation, whether the court will approve the settlement discussed in this press release.
These and other risks, uncertainties and assumptions are detailed in the Risk Factors section and
elsewhere in the documents filed by the Trust with the Securities and Exchange Commission.
Accordingly, there are or will be important factors that could cause actual outcomes or results to
differ materially from those indicated in these statements. The Trust undertakes no obligation to
publicly update or revise any forward-looking statement, whether as a result of new information,
future events, or otherwise.