TXO Partners, L.P. (NYSE:TXO), a company specializing in crude petroleum and natural gas, reported that Gary D. Simpson, President of Production and Development, has established a prearranged trading plan for selling company stock. This plan, set up on November 8, 2024, follows Rule 10b5-1 of the Securities Exchange Act of 1934, which allows company insiders to set up a trading schedule for selling stocks at a time when they are not in possession of material non-public information.
The trading plan is specifically designed to facilitate the sale of common units of the Partnership to cover tax liabilities associated with the vesting of phantom units after February 6, 2025. The plan will remain in effect until the final vesting or forfeiture of the phantom units. The exact number of common units to be sold under this arrangement is not determinable at this time, as it will depend on the vesting conditions being met and the market price of TXO's common units at the time of the sale.
This announcement was made in compliance with federal securities regulations and underscores the company's commitment to transparency and adherence to legal frameworks governing insider trading. Such 10b5-1 plans are commonly used by corporate executives to sell their stock in a manner that avoids accusations of insider trading.
In other recent news, TXO Partners, a crude petroleum and natural gas company, has made significant strides in its business operations. The company completed a substantial acquisition of oil and gas assets in the Williston Basin of Montana and North Dakota, expanding its operational footprint. The assets were purchased from EMEP Acquisitions, LLC and VR4-ELM, LP for a sum of $241.8 million in cash and 2,500,000 common units in TXO Partners.
Simultaneously, TXO Partners has amended its existing credit agreement, increasing the available aggregate commitments from $165.0 million to $275.0 million and extending the maturity date to late 2028 with the addition of new lenders. In conjunction with the asset acquisition, TXO Partners and the sellers signed a registration rights agreement, facilitating the resale of the equity consideration under the Securities Act of 1933.
Furthermore, the company recently raised $19.5 million before underwriting discounts and commissions through the sale of an additional 975,000 common units at $20.00 each. This follows the firm's recent public offering of 5 million common units, aimed to partially fund its acquisitions from Eagle Mountain Energy Partners and another private company.
If the planned acquisitions do not proceed, TXO Partners intends to use the proceeds to repay outstanding debts under its revolving credit facility. Raymond (NS:RYMD) James has been named as the sole book-running manager for the offering. These recent developments highlight TXO Partners' strategic growth and investment in its core business areas.
InvestingPro Insights
As TXO Partners, L.P. (NYSE:TXO) navigates the complexities of insider trading regulations, recent data from InvestingPro sheds light on the company's financial landscape. Despite the establishment of Gary D. Simpson's trading plan, TXO faces some financial challenges. The company's revenue of $285.45 million for the last twelve months as of Q3 2023 represents a decline of 13.79% compared to the previous period. This aligns with an InvestingPro Tip indicating that analysts anticipate a sales decline in the current year.
On a more positive note, TXO pays a significant dividend to shareholders, with a current dividend yield of 12.16%. This high yield could be attractive to income-focused investors, especially considering the dividend growth of 20.83% over the last twelve months. However, potential investors should be aware that the company is not profitable over the last twelve months, with a negative P/E ratio of -4.34.
For those interested in a deeper analysis, InvestingPro offers 8 additional tips for TXO, providing a more comprehensive view of the company's financial health and market position.
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