DALLAS, Nov. 5, 2010 /PRNewswire-FirstCall/ -- Williams
Coal Seam Gas Royalty Trust (NYSE: WTU) announced today that,
pursuant to the governing trust documents, there will be a special
liquidating cash distribution to the holders of its units of
beneficial interest of $2.381443 per
unit, payable November 29, 2010 to
unitholders of record on November 15,
2010. This distribution relates to the net proceeds
from the sale of the Trust's assets to Williams Production Company,
LLC ("WPC") previously announced in the Trust's October 28, 2010 press release.
Prior to the sale of assets to WPC, the Trust owned net profits
interests in certain proved coal seam gas properties previously
owned by WPC and located in the San
Juan Basin of northwestern New
Mexico (the "Working Interest Properties") and southwestern
Colorado, including WPC's 35
percent net profits interest in 5,348 gross acres in La Plata County, Colorado (the "Farmout
Properties").
On October 28, 2010, the Trust
announced that it had completed a sale of the assets of the Trust
in connection with the termination of the Trust. As
previously announced, the trustee solicited bids for the Trust's
royalty interests in June and requested updated bids from previous
bidders in October to confirm the highest acceptable offer.
Following receipt of updated bids and determination of the
highest acceptable offer, WPC had the right under the Trust
Agreement to acquire the royalty interests at a purchase price of
105% of the highest acceptable offer. WPC exercised this
right and purchased the royalty interests for a purchase price of
$23,100,000. A cash reserve to
pay closing costs directly relating to the sale of the assets and
other expenses to be incurred in connection with the winding up of
the Trust, will be held until all expenses have been paid. To
the extent that any of the cash reserve remains after the payment
of all Trust expenses, the trustee may make one or more additional
distributions to the unitholders of record as of November 15, 2010, however no assurance can be
made that any such distributions will occur.
November 15, 2010 will also be the
date that the transfer books for the Trust's units are closed, and
the trustee anticipates that the New York Stock Exchange will
suspend or terminate trading of the Trust's units as of the close
of business on that date.
Pursuant to the terms of the Trust Agreement, the Trust
terminated effective March 1, 2010
because the reserve report as of December
31, 2009, reflected that, as of such date, the net present
value (discounted at 10 percent) of the estimated future net
revenues for proved reserves attributable to the royalty interests
but using the average monthly Blanco Hub Spot Price for the past
calendar year less certain gathering costs was equal to or less
than $30 million thereby triggering a
termination of the Trust.
Following termination, the trustee has continued to act as
trustee of the Trust until all Trust assets are sold and the net
proceeds from such sales distributed to unitholders in accordance
with the procedures set forth in the Trust Agreement. These
procedures are described in more detail in the Trust's most recent
annual report on Form 10-K and quarterly report on Form 10-Q filed
with the Securities and Exchange Commission.
The Trust is a grantor trust formed by The Williams Companies,
Inc., parent company of WPC, and was designed to provide
unitholders with quarterly cash distributions and tax credits under
Section 29 of the Internal Revenue Code, which has expired as of
12/31/2002, from certain coal seam gas properties. The units are
listed on The New York Stock Exchange under the symbol "WTU".
Additional information including the Trust's cash distribution
history, current and prior year financial reports, a link to
filings made with the Securities and Exchange Commission and more
can be found on its website at
http://www.wtu-williamscoalseamgastrust.com/.
SOURCE Williams Coal Seam Gas Royalty Trust