History
SandRidge Mississippian Trust I listed in 2011 to pass on oil and gas royalties, was delisted in 2019, wound up in 2020, and sold its assets in 2021.
2011: Launch of the trust
SandRidge Mississippian Trust I was created to hold royalty interests in oil and gas properties and pass the income to unit holders. The New York Stock Exchange cleared its securities for listing on April 5, 2011. The next day the Trust and SandRidge Energy signed an underwriting agreement to sell 15,000,000 common units at $21.00 each, with an option for 2,250,000 more.
The offering closed on April 12, 2011, with 17,250,000 common units sold. In return, the Trust received perpetual royalty interests in properties in Alfalfa, Garfield, Grant, Major and Woods Counties, Oklahoma, plus 20-year term royalty interests, from SandRidge subsidiaries. SandRidge E&P and Mistmada received 3,750,000 common units, 7,000,000 subordinated units (which convert into common units later) and the net offering proceeds. SandRidge also agreed to drill horizontal wells, secured by a mortgage, to provide hedges (price protection) through 2015, and to provide administrative services for $200,000 a year.
2018-2019: Falling below listing standards
The record is quiet for several years after the launch. In January 2018 the NYSE warned that the 30-day average unit price had fallen below $1.00, giving the Trust six months to cure. The Trust said it would not attempt a reverse split. A second notice followed on December 31, 2018, and a third on May 16, 2019, each starting a new six-month cure period.
The Trust did not regain compliance in the period ending November 16, 2019. The NYSE suspended trading after November 18, 2019 and began delisting proceedings. Units moved to the OTC Pink market as SDTTU, a more limited market that could be less liquid. The exchange filed in December 2019 to remove the securities from listing.
2020-2021: Winding up and sale
The Trust went into dissolution at the close of business on November 13, 2020. Cash available for distribution over the four quarters to September 30, 2020 was about $815,000, below the $1.0 million threshold in the trust agreement.
On April 22, 2021, the Trust sold all its overriding royalty interests to SandRidge Exploration and Production, LLC, a SandRidge subsidiary, for $4,850,000, effective April 1, 2021. SandRidge used its right of first refusal to match a third-party offer at the same price. The Trust owed about $50,000 toward reimbursing the unsuccessful bidder.
As of April 26, 2021, the Trust no longer received production proceeds. A final quarterly distribution of about $0.3 million ($0.0110 per unit) was expected on or before May 28, 2021. The sale proceeds were due to be distributed in the third quarter of 2021, less reserves, but because of securities litigation the Trustee did not expect cash to be available for distribution until it was resolved. Units were expected to be canceled afterwards. On September 9, 2021, the Trust terminated the registration of a class of its securities, ending its reporting obligation for them.
Written from the 10 story beats below (2011 to 9 Sept 2021), which come from the company's own announcements and filings.