Transaction Overview - Boaz Energy and its affiliate Boaz Royalty entered into a Purchase and Sale Agreement with T2S Permian Acquisition II LLC on January 10, 2025, regarding the sale of the Underlying Properties and 4,884,861 Boaz Trust Units [4] - The Underlying Properties are subject to the Net Profits Interest conveyed to the Trust, which grants the Trust the right to receive 80% of the net profits from oil and natural gas production [4][5] Transaction Details - The Grantors will sell and convey to the Buyer all of Boaz Energy's right, title, and interest in the Underlying Properties, which remain burdened by the Net Profits Interest and subject to the Conveyance [1] - The transaction includes the sale of 4,884,861 Boaz Trust Units representing beneficial interests in the Trust [1] - The Closing is anticipated to occur in March 2025, subject to customary closing conditions being satisfied [2] Post-Transaction Operations - From and after the Closing, the Buyer will own the Underlying Properties and the Boaz Trust Units, and the Buyer (or an affiliate) will become the operator of the Underlying Properties [2] - Boaz Energy will facilitate the transfer of operations of the Underlying Properties from Boaz Energy to the Buyer [3] - Argent Trust Company, as trustee of the Trust, expects to continue the administration of the Trust in the ordinary course of business [3] Company Background - PermRock Royalty Trust is a Delaware statutory trust formed to own a net profits interest representing the right to receive 80% of the net profits from the sale of oil and natural gas production from the Underlying Properties [5]

Cash Distribution - PermRock Royalty Trust announced a cash distribution of $367,645.06, equating to $0.030219 per Trust Unit, based on production in August 2024[3] - The cash distribution is payable to record holders of Trust Units as of October 31, 2024, on November 15, 2024[3]

Core Insights - Prelude Therapeutics announced interim clinical data for PRT2527, a selective CDK9 inhibitor, showing activity in relapsed/refractory lymphoid malignancies, including patients previously treated with CAR-T therapy [1][3] - The company plans to seek a partner for the future development of PRT2527 in hematologic malignancies [1] Clinical Trial Overview - The ongoing open-label, dose-escalation trial involved 46 patients treated and safety evaluable as of September 17, 2024 [2][5] - PRT2527 was well-tolerated across four dosing cohorts for monotherapy and three for combination therapy with zanubrutinib, demonstrating an acceptable safety profile [2][4] Efficacy Results - The overall response rate (ORR) for PRT2527 monotherapy was 17.4%, with complete responses (CRs) in 1 patient and partial responses (PRs) in 3 patients [9] - In the combination cohort, the ORR was 38.5%, with CRs in 3 patients and PRs in 2 patients [10] Safety Profile - The most common treatment-emergent adverse events (TEAEs) included neutropenia (48%) and nausea (33%), with grade ≥3 TEAEs being neutropenia (46%) and anemia (11%) [6] - Dose interruptions due to TEAEs occurred in 17 patients, primarily due to neutropenia, which was managed with growth factor support [7] Future Development Plans - The company intends to focus resources on advancing its SMARCA degrader programs while seeking a partner for the CDK9 program beyond the current Phase 1 study [12] - Prelude Therapeutics is recognized for developing innovative medicines in oncology, with a pipeline that includes novel drug candidates and targeted protein degradation technologies [13]

Cash Distribution - PermRock Royalty Trust announced a cash distribution of $365,300.26, equating to $0.030026 per Trust Unit, payable on October 15, 2024[3] - The cash distribution is based principally on production during July 2024[3]

Core Insights - Prelude Therapeutics announced encouraging interim clinical data for PRT3789, a first-in-class SMARCA2 degrader targeting patients with SMARCA4 mutations, showing objective responses in non-small cell lung cancer (NSCLC) and esophageal cancer [1][5][12] - The drug was well-tolerated with no dose-limiting toxicities reported, and the company is advancing to the 9th dosing cohort in its ongoing Phase 1 trial [3][7][13] Patient Data - As of August 5, 2024, 65 patients were safety evaluable, with 46 patients being efficacy evaluable, all having tumors with SMARCA4 mutations [2][6] - Among 26 advanced NSCLC or esophageal patients evaluable for efficacy, 7 experienced tumor shrinkage, with 3 confirmed partial responses [4][9] Safety Profile - Adverse events reported were mostly mild to moderate, including nausea (24.5%), decreased appetite (18.5%), and fatigue (18.5%), with no serious adverse events related to the study drug [7][3] - A maximum tolerated dose has not yet been identified, and dose escalation continues [3][6] Pharmacokinetics and Pharmacodynamics - Preliminary pharmacokinetic data indicated a dose-dependent increase in exposure, with mean concentrations above the SMARCA2 plasma DC50 for approximately 8 hours at the highest dose [8] - Pharmacodynamic effects showed a 70-75% inhibition of SMARCA2 at higher doses, demonstrating the selectivity of PRT3789 [8] Future Plans - The company aims to confirm the biologically active dose for PRT3789 by year-end and continue studies in combination with docetaxel [5][13] - An investor conference call is scheduled for September 13, 2024, to discuss the findings further [10] Upcoming Presentations - Interim Phase 1 data will be presented at the EORTC-NCI-AACR Symposium on October 24, 2024, highlighting the clinical results of PRT3789 [11] Company Overview - Prelude Therapeutics focuses on developing innovative precision oncology medicines, including first-in-class SMARCA2 degraders, to address high unmet medical needs in cancer treatment [15]

Core Viewpoint - Prelude Therapeutics has entered into a collaboration with Merck to conduct a Phase 2 clinical trial evaluating the combination of its investigational SMARCA2 degrader, PRT3789, with Merck's anti-PD-1 therapy, KEYTRUDA, targeting patients with SMARCA4-mutated cancers [2][4][7]. Group 1: Clinical Development - PRT3789 is a first-in-class, highly selective SMARCA2 degrader currently in Phase 1 clinical development, focusing on biomarker-selected SMARCA4 mutant patients [3][11]. - The Phase 1 study aims to establish the safety and tolerability of PRT3789, evaluate its activity, pharmacokinetics, and pharmacodynamics, and determine a recommended Phase 2 dose [3][11]. - Enrollment for the Phase 1 trial is on track, with expectations to conclude monotherapy dose escalation by mid-2024 [3]. Group 2: Collaboration Details - Under the collaboration agreement, Merck will supply KEYTRUDA for the Phase 2 trial, while Prelude will act as the trial sponsor [4][12]. - Both companies retain all commercial rights to their respective compounds, whether used alone or in combination [4]. Group 3: Mechanistic Rationale - The combination of the SMARCA2 degrader and anti-PD-1 therapy is supported by pre-clinical data, which indicates enhanced anti-tumor immunity and tumor regressions in SMARCA4-mutated cancers [8]. - The rationale for this combination was previously presented at the 2023 AACR International Conference on Molecular Targets and Cancer Therapeutics [8]. Group 4: Company Overview - Prelude Therapeutics is focused on developing innovative drug candidates targeting critical cancer cell pathways, with a pipeline that includes PRT3789, a CDK9 inhibitor (PRT2527), and a next-generation CDK4/6 inhibitor (PRT3645) [11]. - The company is also collaborating with AbCellera to discover and develop next-generation antibody drug conjugate products [11].

Cash Distribution - PermRock Royalty Trust announced a cash distribution of $486,630.74, equating to $0.040000 per Trust Unit, based on production during April 2024[6] - The cash distribution is payable on July 15, 2024, to record holders as of June 28, 2024[6]

Core Points - PermRock Royalty Trust declared a monthly cash distribution of $490,223.49 ($0.040295 per Trust Unit) for record holders as of May 31, 2024, payable on June 14, 2024, based on production in March 2024 [1] Group 1: Financial Performance - Underlying oil sales volumes for the current month were 26,162 barrels, an increase from 23,156 barrels in the prior month, while natural gas sales volumes were 28,443 Mcf, up from 24,949 Mcf [2] - Average received prices for oil increased to $78.88 per barrel from $74.64, while natural gas prices decreased to $3.00 per Mcf from $3.71 [2] - Total oil cash receipts for the current month were $2.06 million, an increase of $0.33 million from the prior month, primarily due to higher oil sales volumes and prices [2] - Natural gas cash receipts remained stable at $0.09 million, unchanged from the prior month [2] Group 2: Operating Expenses - Total direct operating expenses were $0.73 million, a decrease of $0.01 million from the prior month [3] - Severance and ad valorem taxes decreased to $0.09 million, down by $0.05 million due to severance tax reimbursements for qualifying exemptions [3] - Capital expenses were $0.13 million, a decrease of $0.10 million attributed to fewer capital projects [3] Group 3: Trust Structure and Operations - PermRock Royalty Trust is a Delaware statutory trust formed by Boaz Energy II, LLC, owning a net profits interest representing 80% of the net profits from oil and natural gas production in the Permian Basin of West Texas [5] - Boaz Energy reserved $184,000 net to the Trust for future capital obligations and expenses in the current month's net profits calculation [4]

Financial Performance - Distributable income for the three months ended March 31, 2024, was $1,122,502, down 49.1% from $2,203,286 in the same period of 2023[14] - Distributable income per unit decreased from $0.181106 in Q1 2023 to $0.092268 in Q1 2024, a decline of 49.1%[14] - Net profits income for Q1 2024 was $1,296,408, a decrease of 45.2% compared to $2,366,677 in Q1 2023[14] - Total revenue for Q1 2024 was $1,311,370, down 44.8% from $2,380,404 in Q1 2023[14] - Total gross profits for the three months ended March 31, 2024, were $5,738,919, down from $7,134,833 in the prior year[1] - Total costs decreased to $3,768,409 from $5,191,487 year-over-year[1] - Net profits for the three months ended March 31, 2024, were $1,970,510, slightly up from $1,943,346 in the same period last year[1] Asset and Cash Management - Total assets decreased from $77,244,781 on December 31, 2023, to $76,329,788 on March 31, 2024, a decline of approximately 1.18%[11] - Trust corpus at the end of Q1 2024 was $75,050,326, down from $75,876,170 at the end of Q4 2023, reflecting a decrease of 1.09%[17] - Cash and short-term investments decreased from $1,368,611 on December 31, 2023, to $1,279,462 on March 31, 2024, a decline of approximately 6.5%[11] - The Trust retained cash reserves of $1,000,000 as of March 31, 2024, unchanged from the previous period[12] - Total cash reserves were $1,000,000 as of March 31, 2024, unchanged from the previous year[61] Production and Sales - Oil sales volumes decreased by 11,407 Bbls (13.3%) for the three months ended March 31, 2024, compared to the same period in 2023[65] - Natural gas sales volumes decreased by 20,344 Mcf (19.5%) for the three months ended March 31, 2024, compared to the same period in 2023[66] - In February 2024, the Trust reported underlying sales volumes of 23,156 barrels of oil and 24,949 Mcf of gas, with average prices of $74.64 per barrel and $3.71 per Mcf[45] - Average realized oil price per Bbl decreased to $73.06 from $76.79 year-over-year[67] - Average realized natural gas price per Mcf decreased to $3.14 from $4.94 year-over-year[68] Distributions and Expenses - The Trust declared distributions of $1,122,502 for Q1 2024, which were fully distributed to unitholders[17] - The Trust declared a cash distribution of $0.030674 per Trust unit based on production during February 2024[44] - The Trustee's annual administrative fee for 2024 is $205,031, which will increase at a rate of 1% per year until the 20th anniversary of the Trust's formation[39] - The Trust is required to make monthly cash distributions of substantially all of its monthly cash receipts after deducting fees and expenses for administration[54] Capital Expenditures - Boaz Energy's estimated capital budget for 2024 for the Underlying Properties is $4.5 million, with approximately $0.9 million expended as of March 31, 2024[41] - As of March 31, 2024, Boaz Energy had reserved $930,157 net to the Trust for future capital expenses[74] Impairment and Evaluation - The Trust's investment in the Net Profits Interest is assessed periodically for impairment, with no impairment recognized as of the latest evaluation[28] - For the three months ended March 31, 2024, the net profits income received by the Trust was $1,296,408, a decrease of 45% compared to $2,366,677 for the same period in the prior year due to decreased oil and gas prices and sales volumes[59] - The Trust's distributable income for the same period was $1,122,502, or $0.092268 per Trust unit, after accounting for interest income of $14,962 and general and administrative expenditures of $188,868[60] Ownership and Units - As of May 13, 2024, Boaz Energy owned 4,884,861 Trust units out of the 12,165,732 Trust units issued and outstanding[40]

Financial Performance - For the year ended December 31, 2023, Boaz Energy reported that Phillips 66, Plains All American Pipeline, Energy Transfer Partners, Blackbeard Operating LLC, and Enterprise Crude Oil LLC accounted for 29.93%, 20.82%, 17.07%, 11.61%, and 10.23% respectively of its total oil and natural gas revenues[42]. - Net profits income for 2023 was $7,127,379, a significant drop of 46% compared to $13,160,845 in 2022[204]. - Total revenue decreased to $7,186,191 in 2023 from $13,177,436 in 2022, reflecting a decline of approximately 45%[204]. - Distributable income per unit fell to $0.514745 in 2023, down from $1.011357 in 2022, a decrease of about 49%[204]. - Total gross profits were $25,780,455, a decrease from $37,207,671 in 2022, reflecting a decline in oil and natural gas sales volumes and prices[215]. - Oil sales volumes decreased to 317,765 Bbl in 2023 from 351,710 Bbl in 2022, while natural gas sales volumes decreased to 387,631 Mcf from 409,881 Mcf in the same period[215]. - The average realized oil price per Bbl dropped to $76.24 in 2023 from $93.15 in 2022, and the average realized natural gas price per Mcf decreased to $3.74 from $7.94[215][218]. - Total operating expenses per Boe increased to $24.79 in 2023 from $22.58 in 2022, an increase of approximately 10%[181]. - Total costs attributable to oil and natural gas production were $17,939,915 in 2023, down from $20,773,247 in 2022, a reduction of about 13%[182]. - General and administrative expenditures increased in 2023 due to timing and payment differences of some expenses[207]. Operational Overview - The Trust receives 80% of the net profits from the sale of oil and natural gas production from the Underlying Properties[30]. - The Underlying Properties consist of 31,354 gross (22,394 net) acres in the Permian Basin[31]. - The Trust makes monthly cash distributions to holders of its Trust units based on the net profits received from the Underlying Properties[29]. - The Trust does not conduct any operations or activities other than managing the Net Profits Interest[28]. - The Trust has no employees and derives all its income from the Net Profits Interest[28]. - The Trust is not liable for any operating, capital, or other costs attributable to the Underlying Properties[34]. - The Trust's assets are located entirely in the United States, with oil and natural gas sold to third-party purchasers domestically[45]. - The Trust's operations are concentrated in the Permian Basin, making it vulnerable to risks associated with operating in a single geographic area[72]. - The ability to develop and operate the Underlying Properties is highly dependent on Boaz Energy's financial condition, which is not guaranteed[93]. - The Trust's cash available for distribution could be reduced by expenses from uninsured claims or title deficiencies related to the Underlying Properties[73]. Regulatory Environment - Boaz Energy's oil and natural gas production operations are subject to stringent environmental regulations that may increase operational costs[48]. - In October 2023, the EPA released a final rule eliminating an exemption for PFAS reporting in small concentrations, indicating increased regulatory scrutiny on hazardous waste management[51]. - The Clean Water Act imposes strict controls on pollutant discharges, with potential delays in oil and gas project development due to permit requirements[53]. - The EPA's August 2023 final rule clarified federal jurisdiction over waters of the United States, potentially affecting permitting processes for oil and gas operations[53]. - New Source Performance Standards (NSPS) for air emissions may increase compliance costs for Boaz Energy, particularly regarding VOCs and methane emissions[54]. - The EPA's proposed amendments to National Emission Standards for Hazardous Air Pollutants (NESHAPs) could lead to higher compliance costs for Boaz Energy[54]. - The adoption of GHG emission reduction goals by various states may impose additional operational restrictions on Boaz Energy, affecting its exploration and production activities[58]. - The EPA's December 2023 final rule aims to reduce methane emissions from oil and gas operations, which could increase operational costs for Boaz Energy[57]. - Hydraulic fracturing activities are subject to increasing regulatory scrutiny, which may lead to higher costs and operational delays for Boaz Energy[64]. - The Endangered Species Act and Migratory Bird Treaty Act may restrict Boaz Energy's operational capabilities in certain areas, potentially incurring additional costs[65]. Market Conditions - Oil and natural gas prices are volatile, and lower prices could reduce cash distributions to Trust unitholders[72]. - The Trust's cash distributions are highly dependent on oil and natural gas prices, which can fluctuate widely due to market uncertainties[75]. - The Trust's reserves and monthly cash distributions may be significantly affected by the ability of OPEC and other oil-exporting nations to maintain production levels[81]. - The volatility of commodity prices may lead to increased operational costs, potentially reducing cash distributions to Trust unitholders[90]. - Geopolitical hostilities, such as war and terrorism, could adversely affect the Trust's distributions and market price of its units[108]. Reserves and Production - As of December 31, 2023, the Underlying Properties had proved reserves of 4.5 million barrels of oil equivalent (MMBoe), with 96% of the volumes and 95% of the present value (PV-10) attributable to proved developed reserves[153]. - The Permian Clearfork area has total proved reserves estimated at 1.4 MMBoe, with 92% classified as proved developed reserves[154]. - The Permian Abo area has total proved reserves of 0.7 MMBoe, with 100% classified as proved developed reserves[156]. - The Permian Shelf area has total proved reserves of 1.2 MMBoe, with 100% classified as proved developed reserves[157]. - The Permian Platform area has total proved reserves of 1.3 MMBoe, with 95% classified as proved developed reserves[158]. - The reserve estimation process involves collaboration between the company's internal petroleum engineer and independent reserve engineers to ensure data integrity[164]. - The proved reserves are estimated using a combination of production performance, volumetric, and analogy methods, ensuring a reasonable level of certainty[162]. - Proved undeveloped reserves decreased significantly from 1,232.7 MBoe in 2022 to 89.0 MBoe in 2023, primarily due to the removal of 1,048.4 MBbl of oil and 622.1 MMcf of natural gas reserves under the SEC five-year booking rule[171]. - The company drilled 4 gross (0.3 net) productive development wells in 2023, compared to 6 gross (1.4 net) in 2022[178]. - Average net daily production fell to 1,047.67 Boe/d in 2023, down from 1,150.75 Boe/d in 2022, a decrease of about 9%[181]. Risks and Uncertainties - The Trust's financial condition may be adversely affected by pandemics or public health concerns, such as COVID-19, which could reduce global demand for oil and gas[79]. - The potential physical effects of climate change could disrupt production and increase costs for Boaz Energy, thereby reducing cash distributions to Trust unitholders[73]. - The accuracy of reserves and future production estimates is critical, as actual reserves may be less than current estimates, potentially reducing cash distributions to Trust unitholders[82]. - Development of proved undeveloped reserves requires capital expenditures, which may exceed initial estimates, impacting future net revenues[83]. - The Trust's cash available for distribution is dependent on access to gathering, transportation, and processing facilities; limitations could interfere with oil and gas sales[87]. - Maintenance projects on the Underlying Properties may affect the quantity of proved reserves that can be economically produced, with timing dependent on market prices[97]. - Delays or cancellations in drilling and production activities could decrease revenues available for distribution to Trust unitholders[86]. - Bankruptcy of Boaz Energy or third-party operators could adversely affect operations and decrease distributions to Trust unitholders[94]. - The reserves are depleting assets, meaning cash distributions to Trust unitholders will likely decrease over time[96]. - The Trust indirectly bears an 80% share of all costs and expenses related to the Underlying Properties, which can decrease cash distributions if costs rise without corresponding revenue increases[101]. Tax and Compliance - Trust unitholders are required to pay U.S. federal income taxes on their share of the Trust's income, even if no cash distributions are received[143]. - The Trust has not requested a ruling from the IRS regarding its tax treatment, which could lead to more complex tax reporting requirements if not classified as a "grantor trust"[139]. - If the Trust cannot meet the NYSE continued listing requirements, it may face delisting if the average closing price falls below $1.00 for 30 consecutive trading days[121]. - The trading price for the Trust units may not reflect the value of the Net Profits Interest, as it is influenced by cash distributions and oil and natural gas prices[124]. - Trust unitholders have limited ability to enforce provisions of the Conveyance creating the Net Profits Interest, and Boaz Energy's liability to the Trust is limited[120].